April 24 (Reuters) – The yield on the 3-month US Treasury bill jumped in early London trade on Monday as unease about the US debt ceiling kept selling pressure on short-dated bonds sustained.
Investors want to avoid bills that will mature when there is a risk that the US could hit its debt ceiling, which might occur in late July or August.
Legislative standoffs over the debt limit this last decade have been resolved before they could ripple into markets, but investors worry the Republican party’sin Congress could make it harder to reach a compromise this time.
The nonpartisan Congressional Budget Office has forecast that the so-calledwhen the government can no longer pay all its bills, would come between July and September.
The 3-month bill yield rose 12 basis points to 5.237%. It hit its highest level since January 2001 at 5.318% last Thursday.
(Reporting by Stefano Rebaudo, editing by Alun John)
This article originally appeared on reuters.com