Wall Street Is Already Preparing Its Debt-Limit War Room

The key industry groups that seek to prevent seismic disruptions in the world’s biggest debt market aren’t waiting around to see if Treasury Secretary Steven Mnuchin can get Congress to lift the debt limit before America exhausts its borrowing capacity.

The Securities Industry and Financial Markets Association, the $14.1 trillion Treasury market’s self-regulatory body, is revisiting and revising work done ahead of previous debt-ceiling showdowns in a bid to lessen the potential market disruption should politicians fail to raise the debt ceiling in time. The group’s primary focus is how operational issues such as trading, clearing, and settlement would be affected should debt payments get delayed. Sifma’s preparations coincide with similar efforts being undertaken by the Federal Reserve-sponsored Treasury Market Practices Group.