House Speaker Kevin McCarthy's ouster could hurt the U.S. economy, according to some financial experts.
A government shutdown could prompt Moody's to downgrade U.S. debt. A last-second continuing resolution agreed to on Sunday kept the government funded until Nov. 17, but McCarthy forged a deal with Democrats to make it happen.
"While government debt service payments would not be impacted and a short-lived shutdown would be unlikely to disrupt the economy, it would underscore the weakness of U.S. institutional and governance strength relative to other AAA-rated sovereigns that we have highlighted in recent years," Moody's wrote.
Financial markets were tumultuous the day before McCarthy's ouster. The Dow fell 430 points and the S&P 500 declined 1.4%. The bond market saw the biggest damage. The yield on a 10-year Treasury bill topped 4.7 percent Tuesday morning, a 16-year high."Yields and oil are the big stories. Those have the biggest economic consequences. And they're coming at a time when the economy's especially fragile," Callie Cox, U.S. investment analyst at eToro, told the Hill.
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