U.S. Treasuries are at the heart of the tumultuous debate over raising the debt ceiling. Nonetheless, U.S. debt is still among the world's safest investments. Judging by yields thus far, it appears Treasury bonds could continue being attractive to investors even if rating agencies downgrade the U.S.
Some have been expecting investors to sell Treasuries out of fear that the nation would default or get hit with a ratings downgrade even if the debt ceiling is raised. However, yields on 10-year bonds are still below 3%, as investors' appetite for Treasuries hasn't faded very much.
To be sure, there has been some modest selling in one and three-month Treasury bills. But yields, which move inversely to prices, haven't exactly surged and are still at the bottom of the month's range.
And even if the U.S. is rated double-A instead of triple-A, it's still not Greece.
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