Treasury yields are flat as investors wait to see how long government shutdown lasts

Core Points - The U.S. government has shut down due to a failure to reach an agreement on a temporary spending bill, primarily over health care tax credits [2] - Lawmakers are engaging in blame games, with President Trump criticizing Democrats for their negotiation stance [3] - The shutdown is expected to delay the release of key economic data, including nonfarm payrolls, which could influence the Federal Reserve's decisions [4] Group 1: Economic Impact - The shutdown may not significantly impact the real economy in the long term, as historical shutdowns have shown a tendency for conditions to revert post-shutdown [5] - However, this shutdown could lead to strategic changes from both political parties, with Republicans and Democrats aiming to leverage the situation for legislative gains [6] Group 2: Market Reactions - Prolonged shutdowns could raise concerns about the credit quality of U.S. debt, potentially affecting Treasury prices and increasing yields [7] - Moody's has previously downgraded the U.S. credit rating and indicated that further downgrades could occur if institutional effectiveness declines [7]