Fitch chose not to follow in the footsteps of Moody’s Investors Service, which raised its UK outlook a month ago from negative to stable after claiming that “policy predictability” had been restored. This places increasing pressure on Sunak, who has been under scrutiny by his Conservative Party as he struggles to shift public opinion in his favor ahead of a likely election next year.

Fitch projects UK economic growth to be 0.5% in 2023, with a mild recession pulling growth down to 0.3% in 2024 before leaping to a 1.8% growth rate in 2025. The government’s fiscal deficit is expected to amount to 5.4% of GDP for 2023. The UK’s outlook was cut last October when Sunak’s, predecessor, Liz Truss, announced a £45 billion package of tax cuts.

The post UK Debt Outlook Remains Negative, Credit Agency Fitch Confirms appeared first on theprimarymarket.com.

“It is hard to disagree with the rationale, with no reasonable expectation for fiscal consolidation any time soon,” Christopher Hodge, chief economist for the U.S. at Natixis, said of Moody’s decision. Hodge added that as interest rates continue to rise, they will pile up the government’s debt.

Moody’s is the last of the three major rating agencies to downgrade its credit rating for the U.S. government. Fitch lowered its rating from triple-A to AA+ in August, while S&P’s AA+ rating has stood since 2011.

The post Moody’s Lowers U.S. Credit Rating to Negative appeared first on theprimarymarket.com.

“We’re seeing some climbing out of the deepest of the difficulties after the pandemic,” Primerica CEO Glenn Williams observed. “We’ve seen inflation slowed down, and we’ve seen earned incomes begin to increase. Both are positives compared to the way things were previously.”

Still, the financial services company’s CEO warned that things are not necessarily all good despite this positive development. U.S. credit card debt has surpassed $1 trillion for the first time, suggesting that although spending power may be on the rise, many American households are struggling to pay off their mounting existing debts.

The post Middle-Class Spending Power Increases In July appeared first on theprimarymarket.com.

The investment giant’s decision to lower its recession odds is driven by the cooldown in market concerns as the banking sector continues to stabilize following March’s crisis which saw the start of the collapse of a slew of U.S. banks.

Also considered was the nation’s GDP growth, with a forecast of 1.8% for 2023. “We have become more confident in our baseline estimate that the banking stress will subtract only a modest 0.4 percentage points from real GDP growth this year,” Jan Hatzius, Goldman’s chief economist stated in anote. “Regional bank stock prices have stabilized, deposit outflows have slowed, lending volumes have held up, and lending surveys point to only limited tightening ahead.”

The post Goldman Reduces U.S. Recession Probability Following Debt Deal appeared first on theprimarymarket.com.

The legislation passed votes in both the House of Representatives and the Senate this past week after Biden and House of Representatives Speaker Kevin McCarthy reached an agreement last Saturday night following weeks of negotiations. While several deadlocks in negotiations were encountered, both sides worked to reach a deal as the Treasury Department warned that the government would be unable to pay its bills and ultimately be forced to default by Monday.

Following the finalization of the legislation, the White House released a statement reading: “Thank you to Speaker McCarthy, Leader Jeffries, Leader Schumer, and Leader McConnell for their partnership.” The Republican-controlled House of Representatives voted 314 to 117 in approval of the bill, while the Senate voted 63 to 36 in support.

According to Fitch Ratings, the U.S. government’s “AAA” credit rating would remain on negative watch despite reaching an agreement that keeps the government in line with its obligations.

The post U.S. Debt Ceiling Bill Signed Into Law appeared first on theprimarymarket.com.

Futures on the S&P 500 edged 0.24% higher, while those on the Nasdaq Composite Index gained 0.16%. Contracts listed on the Dow Jones Industrial Average remained little changed.

With the bill being passed in a 314-117 vote in the House of Representatives, it is not set to be presented to the Senate, where it will be put to a second and final vote.

Although the House vote has been largely viewed as positive, Business Roundtable CEO Joshua Bolten cautioned that the process is not yet complete. “The deadline to raise the debt ceiling is rapidly approaching, and the likelihood of triggering a negative market reaction with severe economic consequences will only increase as we approach the precipice,” Bolten observed.

With such consequences in mind, Bolten called upon the Senate to pass the bill as soon as possible so as to advance the legislative process.

The post Stocks Rise as House Passes Debt Ceiling Deal appeared first on theprimarymarket.com.

Contracts on the S&P 500 edged 0.62% higher while those on the tech-heavy Nasdaq Composite index advanced by 1.39%. Futures listed on the Dow Jones Industrial Average slipped 0.02% lower.

While President Joe Biden and House Speaker Kevin McCarthy were able to reach a tentative agreement on Sunday to raise the government’s debt ceiling, the bill still has to be approved by Congress in order to be enacted into law. The deal will be presented to the House Rules Committee on Tuesday, after which it is expected to be passed on to the House of Representatives for a vote on Wednesday. It will then be passed to the Senate for another vote.

As investors await the final outcome of the debt ceiling agreement, focus is also being placed on the U.S. jobs report that is set to be released later in the week. Economists polled by Bloomberg estimate a drop in monthly payroll additions from 253,000 in April to 180,000.

The post Futures Rise as Debt Ceiling Deal Set for Next Challenge appeared first on theprimarymarket.com.

Both President Biden and House Speaker McCarthy expressed confidence that the agreement will pass in Congress and will therefore reach the President’s desk for signature, which will enact it into law.

West Texas Intermediate futures traded above $72 per barrel on Monday, thereby building on Friday’s 1.2% gain. Oil remains about 10% lower this year as investor confidence is rocked by the Federal Reserve’s extended monetary tightening policy and China’s rocky post-pandemic economic recovery.

Supply continues to remain in focus with OPEC+ scheduled to convene in Vienna on 3 and 4 June to discuss output levels. “The baseline expectation is that OPEC+ will keep quotas intact for the rest of the year,” Ed Bell, senior director for market economics at Dubai-based lender Emirates NBD PJSC, commented.

The post Oil Remains Steady as Traders Await Approval of Debt Ceiling Deal appeared first on theprimarymarket.com.

Contracts on the Nasdaq 100 jumped 0.5%, while those on the S&P 500 climbed 0.4% higher. Futures on the Dow Jones Industrial Average edged higher by a little under 0.1%. In Europe, the Stoxx Europe 600 rose 0.1% during early trading in London.

Investors expressed cautious optimism by returning to some riskier assets after it was announced late Saturday that the White House had reached an agreement to raise the government’s debt ceiling, thereby averting a catastrophic default.

President Joe Biden and House Speaker Kevin McCarthy both expressed confidence that the agreed-upon legislation will be passed by Congress. The government will need to enact the proposed law by June 1, the self-imposed deadline when the government will run out of cash.

Dan Suzuki, deputy chief investment officer at Richard Bernstein Advisors claimed that this development allows investors to focus once again on market fundamentals when making investment decisions. “The obvious positive interpretation is that a negative tail risk is close to being taken off the table,” Suzuki commented.

The post U.S. Futures Rise Following Debt Ceiling Deal appeared first on theprimarymarket.com.

McCarthy revealed to reporters that he and Biden are set to talk once again on Sunday before a bill for the legislation is put up for a vote in Congress on Wednesday.

In anticipation of the June 1 deadline, scores of investors decided to reduce their investment in riskier assets, instead gunning for safe havens. The dollar proved to be one such asset and is expected to be in focus in the coming days after a strong week.

“Markets should breathe a sigh of relief, with the dollar likely to soften a tad as the debt ceiling imbroglio is finally resolved,” Chang Wei Liang, a strategist at DBS Group Holdings in Singapore claimed. “The deal appears well-balanced between reducing spending while not jeopardizing growth, and is likely to be a small positive for US Treasuries.”

Outperforming its historical norms, the dollar advanced against all of its fellow Group-of-10 currencies, with the typically-safe haven yen declining to a six-month low against the dollar of under 140.

The post Global Market Relief Rally Expected Following Debt Ceiling Deal appeared first on theprimarymarket.com.

Fitch chose not to follow in the footsteps of Moody’s Investors Service, which raised its UK outlook a month ago from negative to stable after claiming that “policy predictability” had been restored. This places increasing pressure on Sunak, who has been under scrutiny by his Conservative Party as he struggles to shift public opinion in his favor ahead of a likely election next year.

Fitch projects UK economic growth to be 0.5% in 2023, with a mild recession pulling growth down to 0.3% in 2024 before leaping to a 1.8% growth rate in 2025. The government’s fiscal deficit is expected to amount to 5.4% of GDP for 2023. The UK’s outlook was cut last October when Sunak’s, predecessor, Liz Truss, announced a £45 billion package of tax cuts.

The post UK Debt Outlook Remains Negative, Credit Agency Fitch Confirms appeared first on theprimarymarket.com.

“It is hard to disagree with the rationale, with no reasonable expectation for fiscal consolidation any time soon,” Christopher Hodge, chief economist for the U.S. at Natixis, said of Moody’s decision. Hodge added that as interest rates continue to rise, they will pile up the government’s debt.

Moody’s is the last of the three major rating agencies to downgrade its credit rating for the U.S. government. Fitch lowered its rating from triple-A to AA+ in August, while S&P’s AA+ rating has stood since 2011.

The post Moody’s Lowers U.S. Credit Rating to Negative appeared first on theprimarymarket.com.

“We’re seeing some climbing out of the deepest of the difficulties after the pandemic,” Primerica CEO Glenn Williams observed. “We’ve seen inflation slowed down, and we’ve seen earned incomes begin to increase. Both are positives compared to the way things were previously.”

Still, the financial services company’s CEO warned that things are not necessarily all good despite this positive development. U.S. credit card debt has surpassed $1 trillion for the first time, suggesting that although spending power may be on the rise, many American households are struggling to pay off their mounting existing debts.

The post Middle-Class Spending Power Increases In July appeared first on theprimarymarket.com.

The investment giant’s decision to lower its recession odds is driven by the cooldown in market concerns as the banking sector continues to stabilize following March’s crisis which saw the start of the collapse of a slew of U.S. banks.

Also considered was the nation’s GDP growth, with a forecast of 1.8% for 2023. “We have become more confident in our baseline estimate that the banking stress will subtract only a modest 0.4 percentage points from real GDP growth this year,” Jan Hatzius, Goldman’s chief economist stated in anote. “Regional bank stock prices have stabilized, deposit outflows have slowed, lending volumes have held up, and lending surveys point to only limited tightening ahead.”

The post Goldman Reduces U.S. Recession Probability Following Debt Deal appeared first on theprimarymarket.com.

The legislation passed votes in both the House of Representatives and the Senate this past week after Biden and House of Representatives Speaker Kevin McCarthy reached an agreement last Saturday night following weeks of negotiations. While several deadlocks in negotiations were encountered, both sides worked to reach a deal as the Treasury Department warned that the government would be unable to pay its bills and ultimately be forced to default by Monday.

Following the finalization of the legislation, the White House released a statement reading: “Thank you to Speaker McCarthy, Leader Jeffries, Leader Schumer, and Leader McConnell for their partnership.” The Republican-controlled House of Representatives voted 314 to 117 in approval of the bill, while the Senate voted 63 to 36 in support.

According to Fitch Ratings, the U.S. government’s “AAA” credit rating would remain on negative watch despite reaching an agreement that keeps the government in line with its obligations.

The post U.S. Debt Ceiling Bill Signed Into Law appeared first on theprimarymarket.com.

Futures on the S&P 500 edged 0.24% higher, while those on the Nasdaq Composite Index gained 0.16%. Contracts listed on the Dow Jones Industrial Average remained little changed.

With the bill being passed in a 314-117 vote in the House of Representatives, it is not set to be presented to the Senate, where it will be put to a second and final vote.

Although the House vote has been largely viewed as positive, Business Roundtable CEO Joshua Bolten cautioned that the process is not yet complete. “The deadline to raise the debt ceiling is rapidly approaching, and the likelihood of triggering a negative market reaction with severe economic consequences will only increase as we approach the precipice,” Bolten observed.

With such consequences in mind, Bolten called upon the Senate to pass the bill as soon as possible so as to advance the legislative process.

The post Stocks Rise as House Passes Debt Ceiling Deal appeared first on theprimarymarket.com.

Contracts on the S&P 500 edged 0.62% higher while those on the tech-heavy Nasdaq Composite index advanced by 1.39%. Futures listed on the Dow Jones Industrial Average slipped 0.02% lower.

While President Joe Biden and House Speaker Kevin McCarthy were able to reach a tentative agreement on Sunday to raise the government’s debt ceiling, the bill still has to be approved by Congress in order to be enacted into law. The deal will be presented to the House Rules Committee on Tuesday, after which it is expected to be passed on to the House of Representatives for a vote on Wednesday. It will then be passed to the Senate for another vote.

As investors await the final outcome of the debt ceiling agreement, focus is also being placed on the U.S. jobs report that is set to be released later in the week. Economists polled by Bloomberg estimate a drop in monthly payroll additions from 253,000 in April to 180,000.

The post Futures Rise as Debt Ceiling Deal Set for Next Challenge appeared first on theprimarymarket.com.

Both President Biden and House Speaker McCarthy expressed confidence that the agreement will pass in Congress and will therefore reach the President’s desk for signature, which will enact it into law.

West Texas Intermediate futures traded above $72 per barrel on Monday, thereby building on Friday’s 1.2% gain. Oil remains about 10% lower this year as investor confidence is rocked by the Federal Reserve’s extended monetary tightening policy and China’s rocky post-pandemic economic recovery.

Supply continues to remain in focus with OPEC+ scheduled to convene in Vienna on 3 and 4 June to discuss output levels. “The baseline expectation is that OPEC+ will keep quotas intact for the rest of the year,” Ed Bell, senior director for market economics at Dubai-based lender Emirates NBD PJSC, commented.

The post Oil Remains Steady as Traders Await Approval of Debt Ceiling Deal appeared first on theprimarymarket.com.

Contracts on the Nasdaq 100 jumped 0.5%, while those on the S&P 500 climbed 0.4% higher. Futures on the Dow Jones Industrial Average edged higher by a little under 0.1%. In Europe, the Stoxx Europe 600 rose 0.1% during early trading in London.

Investors expressed cautious optimism by returning to some riskier assets after it was announced late Saturday that the White House had reached an agreement to raise the government’s debt ceiling, thereby averting a catastrophic default.

President Joe Biden and House Speaker Kevin McCarthy both expressed confidence that the agreed-upon legislation will be passed by Congress. The government will need to enact the proposed law by June 1, the self-imposed deadline when the government will run out of cash.

Dan Suzuki, deputy chief investment officer at Richard Bernstein Advisors claimed that this development allows investors to focus once again on market fundamentals when making investment decisions. “The obvious positive interpretation is that a negative tail risk is close to being taken off the table,” Suzuki commented.

The post U.S. Futures Rise Following Debt Ceiling Deal appeared first on theprimarymarket.com.

McCarthy revealed to reporters that he and Biden are set to talk once again on Sunday before a bill for the legislation is put up for a vote in Congress on Wednesday.

In anticipation of the June 1 deadline, scores of investors decided to reduce their investment in riskier assets, instead gunning for safe havens. The dollar proved to be one such asset and is expected to be in focus in the coming days after a strong week.

“Markets should breathe a sigh of relief, with the dollar likely to soften a tad as the debt ceiling imbroglio is finally resolved,” Chang Wei Liang, a strategist at DBS Group Holdings in Singapore claimed. “The deal appears well-balanced between reducing spending while not jeopardizing growth, and is likely to be a small positive for US Treasuries.”

Outperforming its historical norms, the dollar advanced against all of its fellow Group-of-10 currencies, with the typically-safe haven yen declining to a six-month low against the dollar of under 140.

The post Global Market Relief Rally Expected Following Debt Ceiling Deal appeared first on theprimarymarket.com.