For the first time in a while, bond traders are fretting over the U.S. government’s yawning fiscal deficits. Investors had been bracing for a deluge of new debt issuance in anticipation that the fiscal stimulus measures, healthcare spending, and hit to local and state budgets, resulting from the coronavirus pandemic, would require the Treasury Department to find buyers for trillions of government debt.
“The surprise element of the Treasury’s issuance plan is not in its sheer size – the $3 trillion of fiscal stimulus is now common knowledge,” said Gaurav Saroliya, director of macro strategy for Oxford Economics, in a note.Story continues
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