The U.S. Capitol building on the first day of a partial government shutdown in Washington, D.C., U.S., October 1, 2025. REUTERS/Nathan Howard

NEW YORK (Reuters) -Spreads on U.S. government credit default swaps, market-based gauges of the risk of a sovereign default, have ticked higher amid market concerns over the U.S. government shutdown.

Six-month spreads rose by one point to 17 basis points, the highest since mid-July, while one-year and five-year spreads held at 21 bps and 42 bps, respectively, their widest since July, according to S&P Global Market Intelligence data on Wednesday.

The U.S. government shut down large parts of its operations on Wednesday after partisan deadlock blocked a funding deal, triggering a potentially prolonged standoff that threatens thousands of federal jobs.

The current government shutdown is not linked to debt ceiling concerns, which is when U.S. government CDS spreads typically widen due to fears politicians may fail to raise or suspend a limit on federal borrowing before a sovereign default.

Still, CDS spreads have widened this year because of broader U.S. policy uncertainty.

Ratings agency Fitch said on Wednesday the shutdown did not have near-term implications for its rating of U.S government debt, but said it highlighted "long-standing policymaking weaknesses and political brinkmanship around budgetary issues."

Fitch cited political wrangling over fiscal decisions as a major concern, along with rising U.S. government debt levels, when it downgraded U.S. government debt by one notch to 'AA+' from triple-A in 2023.

(Reporting by Davide Barbuscia; Editing by Chris Reese)