Money Fund Risks Rise with Debt Debate

Moody's report cites potential for skipped payments on Treasury bonds.

The impasse in Washington over raising the federal debt ceiling has exposed U.S. money-market mutual fund clients to increased danger, according to Moody’s Investors Service.

“Direct risks include the potential for a missed interest or principal payment on government bonds for a short period of time, as well as incremental weakening of the overall credit quality of money-market fund portfolios that have U.S. government exposure,” the New York-based ratings company said today in a statement.

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