As talks to raise the US debt ceiling stalled, US stocks fell and short-term Treasury bills extended losses.
On Tuesday, the talks continued. However, progress appeared to be slow, with some House Republicans questioning the urgency imposed by Treasury Secretary Yellen's deadline for when the government will begin missing some debt payments.
With little time left for politicians to reach an agreement, investors have demanded higher premiums to hold US debt, particularly those at the highest risk of default. Securities maturing on June 8 have yields above 5.7%, while bills maturing on May 30 have yields around 2%.
President Biden and House Speaker Kevin McCarthy described their Monday meeting as productive. However, an agreement on the debt ceiling remains elusive, with McCarthy pleading with Republicans to remain united in their demands in order to prevent a US default.