The largest holders of Puerto Rico bonds are betting that a planned debt sale by the commonwealth will fuel a rally in its securities by alleviating doubts the U.S. territory can raise funds in the capital markets.
Here’s what to look for when Janet Yellen testifies before the House Financial Services Committee today in her first public remarks since becoming Federal Reserve chairman on Feb. 3. Yellen’s prepared remarks will be released at 8:30 a.m., and the hearing will begin at 10 a.m. Yellen plans to speak to the Senate Banking Committee on Feb. 13 in a second day of semi-annual testimony.
Detroit’s plan to end backfiring interest-rate hedges taken on almost a decade ago is its first step back to the municipal bond market even as investors gird for a return of pennies on the dollar to current holders.
Jefferson County, which filed the biggest U.S. municipal bankruptcy until Detroit, is selling $1.8 billion of sewer debt to help exit court protection. Standard & Poor’s rates the bonds above junk. Investors disagree.
The fading notion that the largest U.S. finance companies are too big to fail led Moody’s Investors Service to cut ratings on $5.5 billion of bank-backed debt used to buy natural gas. Investors see the bonds as too cheap to pass up.