Warren Buffett buys Treasuries regardless of a downgrade of the US rating by Fitch

(Bloomberg) — It is enterprise as normal for Warren Buffett’s Berkshire Hathaway after Fitch’s downgrade of the US.

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Berkshire purchased $10 billion in US Treasury notes final Monday. We purchased $10 billion in Treasury notes on Monday. Buffett stated on CNBC that the one query for subsequent Monday is whether or not we purchase $10 billion in 3-month or 6-month Treasury notes. “There are some issues folks should not fear about,” he stated. “That is one.”

Fitch downgraded the USA’ sovereign score to AA+ from AAA earlier this week, citing the nation’s rising deficit and rising political brinksmanship across the cyclical efforts wanted to lift the debt ceiling. The timing was proper – lower than 24 hours later, the federal government ramped up quarterly borrowing plans for the primary time in two and a half years.

Whereas the markets reacted reasonably within the wake of the downgrade, long-term Treasurys are poised for his or her worst week this 12 months. That is as a result of the transfer got here similtaneously elevated US bond issuance, the Financial institution of Japan’s adjustment on its management of home yields and powerful US jobs information damage demand for US debt.

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