Yellen Rebukes Fitch's 'Unwarranted' Downgrade Of US Credit Rating: Treasuries Hit 9-Month Low
Portfolio Pulse from Piero Cingari
US Treasury Secretary Janet Yellen has criticized Fitch's decision to downgrade the US credit rating from AAA to AA+, calling it 'entirely unwarranted'. The downgrade led to a significant drop in stock prices and a fall in long-dated US Treasury bonds. Yellen argues that Fitch's assessment is flawed and based on outdated data, failing to acknowledge the significant improvements in various indicators over the last 2 1/2 years.
August 04, 2023 | 11:59 am
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NEGATIVE IMPACT
Although JPMorgan Chase & Co. (NYSE:JPM) is not directly mentioned in the article, the bank's stock price may be affected by the overall drop in stock prices following Fitch's downgrade of the US credit rating.
As a major financial institution, JPMorgan Chase & Co. (NYSE:JPM) is likely to be affected by the overall drop in stock prices following Fitch's downgrade of the US credit rating. This is because the downgrade could lead to increased uncertainty in the financial markets, which could negatively impact the bank's stock price.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
The Ishares 20+ Year Treasury Bond ETF (NASDAQ:TLT) fell to its lowest levels since November 2022 following Fitch's downgrade of the US credit rating.
The downgrade of the US credit rating by Fitch led to a fall in the value of long-dated US Treasury bonds, which are represented by the Ishares 20+ Year Treasury Bond ETF (NASDAQ:TLT). This is because the downgrade implies a higher risk of default, which makes these bonds less attractive to investors.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100