TREASURIES-U.S. bond prices hold losses on Fitch's watch on U.S. AAA-rating
NEW YORK Oct 15 (Reuters) - U.S. Treasuries prices held losses in late trading on Tuesday after Fitch Ratings said it might take away United States' AAA credit rating as Washington has struggled to reach a debt deal in a bid to avert default.
The federal government has been expected to exhausted its $16.7 trillion statutory borrowing limit on Thursday.
"Although Fitch continues to believe that the debt ceiling will be raised soon, the political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default," the rating agency said in a statement.
Benchmark 10-year Treasury notes were 13/32 lower in price to yield 2.731 percent, up 5 basis points from late on Friday.
Interest rates on Treasury bills in the meantime held at their earlier highs. The rate on the T-bill issue that matures on Oct. 31 was last 0.5475 percent, up 23 basis points from late Friday.
The U.S. bond market was closed on Monday for the Columbus Day holiday.
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