Bond yields keep climbing despite Treasury intervention
US borrowing costs continue to rise even as the Treasury tries to step in, with record deficit spending and persistent inflation pressuring the bond market.
The current surge in US borrowing costs is being described as more than a coincidence. Even with the US Treasury attempting to intervene, yields have continued to move higher.
Market observers point to record deficit spending and a 60-month stretch of inflation at or above 2% as key factors. The bond market, they argue, can no longer ignore those underlying conditions.
The view expressed is that asset owners stand to be the only winners in this environment.
Source: The Kobeissi Letter