Odaily Planet Daily News According to analysis by The Kobeissi Letter, the 1-year US credit default swap (CDS) has risen to 52 basis points recently, close to the highest level since 2023. Excluding the debt ceiling crisis in 2023, the insurance cost of the US government default is at its highest level in 12 years.
In addition, the outstanding amount of US credit default swaps increased by about $1 billion this year to $3.9 billion, the second highest level since 2014. Currently, investors are increasingly concerned about the rising deficit of the US government. The United States reached its statutory borrowing limit in January and took "extraordinary measures" to avoid default.
The analysis pointed out that the debt ceiling crisis has never been truly resolved and the risk of US government default has increased.