State Street CEO Warns a US Downgrade Could See Treasuries Drop
- O’Hanley sees danger of ‘lots of dislocations’ in markets
- State Street not predicting crisis, but worries over risks
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State Street Chief Executive Officer Ron O’Hanley warned against betting on a Treasuries rally in the wake of any downgrade of the US credit rating amid the political battle over the debt limit.
Back in 2011, Treasuries still served their traditional role as a haven amid market turmoil in the aftermath of S&P Global Ratings cutting the US rating from AAA. That move had roiled equities and ended up damaging consumer confidence, hurting the economic recovery from the credit crisis.