Trump Administration Focuses on Reducing 10-Year Treasury Yield
U.S. Treasury Secretary Scott Bessent stated that the Trump administration focuses on lowering the yield of the 10-year Treasury note to reduce borrowing costs. Key points include:
- The 10-year yield influences long-term loans, including mortgages and business loans.
- A declining yield is typically bullish for risk assets, including bitcoin.
- Trump aims to control inflation and reduce the budget deficit, which may impact risk assets positively or negatively.
- Bessent emphasized boosting energy supply as a means to lower inflation.
- Lower inflation could allow the Federal Reserve to continue cutting rates, enhancing bullish momentum in risk assets.
- Efforts to reduce the budget deficit would involve cutting fiscal spending, impacting bond supply and yields.
- Analysts express skepticism about sustaining lower yields, identifying a potential floor just below 4% for the 10-year yield.
