The US 10-Year Treasury Yield Trend is Unfavorable to Trump, Revealing Cracks in the Global Financial System

On April 8th, as reported by CoinDesk, Monday's trading session this week emerged as one of the most volatile trading days since the March 2020 pandemic-induced market crash. However, the real spotlight was on the US 10-year Treasury yield. This particular indicator, known as the "risk-free rate," is a crucial data point that the Trump administration aims to keep suppressed in order to refinance the trillions of dollars in government debt. Ordinarily, when economic growth expectations strengthen or inflationary pressures rise, investors may reduce their demand for safe-haven assets like government bonds and instead favor risk assets, resulting in an increase in the 10-year Treasury yield. Nevertheless, during Monday's market sell-off, the US 10-year Treasury yield, which was expected to decline, instead soared to 4.22%. Saxo Bank's Head of Commodity Strategy, Ole S. Hansen, pointed out that "violent fluctuations in long-term US bonds may suggest underlying market pressures. The 30-year US Treasury benchmark yield surged from a low of 4.30% to 4.65%, and the 10-year yield rebounded from the previous day's low of 3.85% to 4.17%. Such intense volatility may indicate a larger-scale asset reallocation. There is speculation that foreign holders may be selling off US Treasuries and withdrawing funds. Market rumors suggest that some countries have recently sold $50 billion worth of US Treasuries." This surge is not exclusive to the US; the UK bond yield witnessed its largest increase since the October 2022 Truss Pension Crisis. The global rise in sovereign bond yields indicates that market confidence in sovereign debt and currencies is disintegrating.