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US debt outlook

Treasuries and the US public debt threat 

Assessing the risks to the bond market from a US fiscal crisis 

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The election may have sharpened focus on the viability of massive levels of US public debt, but this issue goes beyond who's in the White House. New analysis from Capital Economics assesses the threat to the Treasury market as the US debt mountain continues to grow, exploring the key risks facing holders of US paper. In this in-depth analysis, you will learn: 

  • How global and domestic appetite for Treasuries could evolve as the debt picture worsens;

  • The extent to which term premia on Treasury bonds could increase;  

  • What a fiscal crisis in the bond market could look like.

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The US public finances are clearly already in bad shape. And they are likely to get worse before they get better. That could eventually prompt a more adverse reaction in the Treasury market than we have seen so far.
John HIggins
John Higgins
Chief Markets Economist

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