U.S. Credit Default Swaps Reach Highest Level Since 2023

According to Odaily, recent analysis by The Kobeissi Letter reveals that the one-year U.S. credit default swaps (CDS) have surged to 52 basis points, nearing the highest level since 2023. Excluding the debt ceiling crisis of 2023, the cost of insuring against a U.S. government default is at its highest in 12 years. Additionally, the outstanding amount of U.S. CDS has increased by approximately $1 billion this year, reaching $3.9 billion, marking the second-highest level since 2014. Investors are increasingly concerned about the rising U.S. government deficit. In January, the United States reached its statutory borrowing limit and implemented "extraordinary measures" to avoid default. Analysts indicate that the debt ceiling crisis was never fully resolved, leading to heightened risks of a U.S. government default.