Shares edge up in nervy trade ahead of debt limit talks
Global shares edged up on Tuesday, while the dollar eased back from five-week highs as U.S. lawmakers prepared for another round of talks to resolve the deadlock over the government’s borrowing limit.
The weaker dollar supported crude oil and equities, although investors were wary of crucial U.S. government debt-ceiling negotiations, with a little more than two weeks to go before the government could run short of money to pay its bills.
Investors have dumped short-term U.S. Treasuries that mature around the “X date” – the point beyond which the government runs out of money to pay its bills without an increase in the borrowing limit.
Other than that, however, global markets are showing little evidence of stress, at least for now.
Michael Brown, a strategist at TraderX, said he believed there would eventually be an agreement, but the concessions President Joe Biden’s Democrats may have to make in order to strike a deal could come at a high cost to the U.S. economy.
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