For investors already anxious about the debt ceiling, recent comments from President Trump are doing little to allay their concerns.
The rate on Treasury bills maturing Oct. 12 jumped by as much as 5 basis points Thursday, the largest intraday move since March, after Trump blamed Congress's inability to increase America's borrowing authority on the Republican leaders in a series of tweets. The bills, which mature around the time when Treasury is estimated to run out of money unless lawmakers extend or suspend the statutory limit on the nation's borrowing, are currently trading at 1.17 percent.
The recent rise in October rates is "the culmination of the passage of time coupled with President Trump threatening a government shutdown to get his border wall funding and the fact that his tweets make it seem like raising the debt ceiling is going to be a bigger challenge," said Mark Cabana, head of U.S. short rates strategy at Bank of America Corp. "Shifting blame onto other Republican leaders just increases the headline risk."
