Goldman Sachs: Foreign Investors Unlikely to Abandon U.S. Treasury Bonds

Odaily Planet Daily reports: Despite Moody's downgrade of the U.S. Treasury's credit rating, foreign investors are unlikely to abandon the U.S. Treasury market due to the lack of suitable alternatives at present. Lindsay Rosner, Head of Multi-Industry Investments at Goldman Sachs Asset Management, said: "Globally, there are very few countries with a AAA sovereign credit rating, actually close to 11, but if you look at the size of these countries' bond markets, they are negligible compared to the U.S. Treasury market." "Ultimately, the U.S. market has a depth and breadth unmatched by other markets." She also noted that if long-term Treasury yields remain above 5%, "we will eventually reach a tipping point where hedging effects, especially the interest rate spread, will start to become attractive." (Jin10)