讀後心得

Last Friday, U.S. Treasury prices rose and yields fell, but the gains narrowed as Federal Reserve Chair Jerome Powell warned that new tariffs could impact inflation. The yield on the 2-year Treasury fell to 3.6520%, the 5-year to 3.7088%, the 10-year to 3.9943%, and the 30-year to 4.4090%. Market concerns over the trade war intensified, causing Treasury yields to drop to their lowest levels of the year. Despite lackluster employment data in March, expectations for rate cuts by the end of the year rose, and analysts noted that after Powell emphasized that there was no rush to cut rates, the upward momentum began to weaken.

The prices of U.S. government bonds rose last Friday, causing yields to decline, but the increase at closing was lessened due to the Federal Reserve Chairman emphasizing that the recently announced tariffs by the U.S. government may have a lasting impact on inflation.

According to bond trading quotes,

• The price of the 2-year Treasury rose, with yields down by 2.97 basis points, reported at 3.6520%;
• The price of the 5-year Treasury increased, with yields sliding by 1.77 basis points, reported at 3.7088%;
• The price of the 10-year Treasury rose, with yields down by 3.42 basis points, reported at 3.9943%;
• The price of the 30-year Treasury increased, with yields decreasing by 6.14 basis points, reported at 4.4090%.

The Chairman emphasized that the economic impact of the new tariffs may outweigh expectations, and the Federal Reserve must ensure that it does not trigger more severe inflation issues. As market concerns over the escalating trade war threaten economic growth, bond yields earlier slid to their lowest point of the year, while the mixed employment data for March had limited responsiveness.

Investor expectations for Federal Reserve rate cuts continue to grow, anticipating a reduction of 100 basis points by the end of the year, compared to an expected cut of 94 basis points at last Thursday's close. Market analysts noted that the bond market had a limited reaction to the employment data, but as the Chairman stated that tariffs could have a long-term impact on inflation and reiterated that policymakers are "not in a hurry" to cut rates, the upward momentum began to weaken.