“It ain’t over till it’s over,” a phrased first coined by baseball legend Yogi Berra, could easily be applied to the most recent debt ceiling debate in Washington. As bi-partisan negotiations wind their way toward a House vote and the likelihood of a deal increases, US Treasury yield analysis from Morningstar Indexes details day-to-day shifts in investor sentiment.
Katie Binns – Director of Fixed Income & Multi-Asset, Morningstar Indexes
“Last week, prevailing uncertainty around debt ceiling negotiations led to a gap of more than 200 basis points in yield on US Treasury Bills maturing in early June and those maturing in early July, with short-term Treasury bill end-of-day yields nearing 6% on Wednesday. However, surrounding the long holiday weekend as deal prospects improved, that difference narrowed and the Morningstar US 1-3 Month Treasury Bill Index yield declined by 1.3%. As the House prepares to vote today, market jitters appear to have returned with the short-term Treasury yield moving back up.”
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