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2025-09-12 18:14:45
Is Bond Market Sentiment Shifting? Expectations of Rate Cuts May Stabilize Yields. (1) BlueBay Chief Investment Officer Mark Dowding stated that the news that US President Trump is not considering nominating an independent outsider for the Federal Reserve Chair position may provide some comfort to US Treasury investors, potentially helping to stabilize long-term yields. (2) Dowding believes BlueBay has consistently expected the next phase of the US Treasury yield curve steepening trade to be led by falling short-term interest rates, rather than a sell-off in long-term bonds. (3) With the Federal Open Market Committee resuming its rate-cutting cycle, this is expected to occur. (4) The market generally expects the Fed to cut interest rates by 25 basis points next week, with a 50 basis point cut less likely. (5) The 10-year US Treasury yield is currently at 4.042%, having risen 3.2 basis points.
