Daily Close | Forex, Metals, Oil, Agriculture May 25, 2023



Similarly, the collateral rules for the Federal Reserve s discount window require investment-grade ratings (BBB- or better) for US dollar corporate bonds, and AAA ratings for foreign-currency corporate bonds. It will also place more scrutiny on the dollar and Treasuries as havens and its risk-free rate qualities.

United States

It concluded that stocks listed only in the US had 2.5 times greater trading volumes, about three times more liquidity and two times higher median price-to-equity valuation. When Fitch harrumphs that the US government might default, it gets headlines, and a Treasury spokesperson says stuff about how it underscores the need for swift bipartisan et cetera. The US Commodity Futures Trading Commission s rules for derivatives margin also say that US government securities are eligible collateral with no ratings criteria.
That is from Ruth Carson’s Bloomberg story on potential ratings cuts due to the US debt ceiling negotiations. Under Wall Street s plan, though, investors would be able to keep trading all U.S. Treasurys, even those with past-due interest or principal payments. Big Wall Street institutions and at-home individual investors alike are taking part, feeding on each other s selling and buying. He worked with [Nasdaq Inc. Chief Executive Officer Adena] Friedman and Nasdaq staff on research to show that dual-listed stocks tend to underperform their peers over time.
Even so, the action might concentrate minds in both Washington and Wall Street. It moved the US to rating watch negative under its classification. Meantime, DBRS Morningstar placed the US ratings of AAA under review with negative implications. If they had downgraded the US a month ago would that have been helpful?