Cost of insuring against US default rises to highest since 2009

In the latest indication of investor jitters over the debt ceiling dispute, the cost of insurance against a US default increased to its highest level since early 2009. S&P Global Market Intelligence data shows that US 5-year sovereign credit default swaps increased to 74 basis points, up from 73 basis points at the previous closing and the highest level since March 2009. On Wednesday, US President Joe Biden warned that failing to swiftly increase the $31.4 trillion debt ceiling might cause the economy to contract and result in the loss of tens of thousands of jobs. Donald Trump, who is now in the lead for the 2024 Republican presidential nomination, suggested that the party either demand drastic budget cutbacks or allow the US to go into default, downplaying the repercussions of either option. Indicating investor apprehension, the yield on the one-month US Treasury note increased 18 basis points to 5.705 per cent on Thursday. According to statistics from Refinitiv, it was below Wednesday’s top of 5.811 per cent, which was the most since 2001. Prices and yields follow opposite trends. Read all the Latest News, Trending News, Cricket News, Bollywood News, India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.