US bond hits a 9-month high! Wall Street: 10-year Treasury Intrerest Rate may rise to 5% by the end of this year

In recent times, US bonds have faced huge selling pressure. One reason is that the US Treasury will issue new bonds with a total price of up to $119 billion this week. Another reason is the market's concern that inflation may rebound and exacerbate the US debt problem after Trump takes office. (Previous summary: US 10-year bond yield rises above 4.5%! New bond king: Won't buy BTC before Trump takes office) (Background supplement: US think tank: BTC strategic reserve 'cannot solve the US debt crisis' BTC is not that amazing..) The US Department of Labor announced last night that job vacancies have reached a new six-month high, along with higher-than-expected ISM non-manufacturing index, indicating that the US economy is stronger than the market expected, which means that the Federal Reserve may slow down its interest rate cuts this year. As a result, the yield on US 10-year bonds has risen to 4.69%, the highest since April 2024. US 10-year Treasury yield. Source: Finance M Square Why is the yield on US bonds rising instead of falling? In addition to the strong economic data mentioned above, one of the reasons affecting the yield on US bonds is the tariff policy repeatedly mentioned by the newly elected US President Trump before he took office this month, which has reignited concerns about inflation in the market. At the same time, the potential tax reduction policy of Trump has also raised concerns that the US government debt will continue to increase in the future. For example, the Committee for a Responsible Federal Budget (CRFB) estimates that Trump's economic policies may increase US government debt by $7.8 trillion in the next 10 years. In addition, the US Treasury sold $58 billion worth of 3-year bonds, $39 billion worth of 10-year bonds, and $22 billion worth of 30-year bonds this week, which is also a factor. Analysts expect that the yield on US bonds will continue to rise. In this context, Academy strategist Peter Tchir recently predicted that the yield on US 10-year bonds has not yet reached its peak and will continue to rise to 4.75% in the future. Jim Bianco, President of Bianco Research, even said that the average yield on 10-year US bonds this year will reach 5.23%. Another noteworthy point is that Mohit Kumar, Chief Economist of Jefferies International, mentioned that the market's expectation of interest rate cuts by the Federal Reserve this year has also been lowered, which will be an important factor putting pressure on US bonds: The hawkish stance revealed by the Federal Reserve at its December meeting, combined with market concerns about US fiscal pressure, has led to continued upward pressure on bond yields. Jason Furman, former senior economist in the Obama administration (Deputy Director of the National Economic Council) and current professor at Harvard University, pointed out that if the labor market remains healthy this year, the Fed may only cut interest rates once because the Federal Reserve has entered a new stage where it needs reasons to support interest rate cuts: Last year, the Fed believed that everything was fine, so it took a cautious attitude towards interest rate cuts. But if the labor market remains healthy, considering concerns about inflation prospects and whether the federal benchmark interest rate is already in the best position for demand to slow down, it is most likely that interest rates will only be cut once by 1 basis point this year. On the other hand, Furman also predicted a worse situation, that is, there may be interest rate hikes in 2025: If the inflation rate measured by the PCE index, which is favored by the Fed, rises above 3% in the middle of this year, the Federal Reserve may consider changing its course. The US economy will slow down, consumer pressure will increase, and Trump's plans may not change much. Many things are developing in a worse direction. Related reports: Was Trump's inauguration the 'lowest point' for BTC? Yellen warns: US debt ceiling dates from January 14th to 23rd Tether netted $2.5 billion in Q3 with gold and US bonds! Total assets and equity hit a new record US bonds big dump! 10-year yield soars to 4.2%, breaking a three-month high, community cries out: I'm a pig, buy more (US bonds hit a nine-month high! Wall Street: 10-year yield may rise to 5% by the end of this year) This article was first published on BlockTempo, the most influential blockchain news media on DQ.