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Experts warn: The United States may see a repeat of the UK's 2022 mini-budget crisis! The dollar is violently fluctuating, and the yield on government bonds is soaring.
Bond strategists warn that with Trump's return to the White House, the United States may experience a replica of the UK's 2022 "mini-budget" crisis, when the specter of Exchange RateFluctuation and soaring bond yields will hang over the United States, and the Benchmark 10-year US Treasury yield may break the 5% threshold. (Synopsis: Nomura predicts that the Fed will suspend interest rate cuts in December, and will only cut rates by two yards next year... High uncertainty about Trump's presidency) (Background added: Trump's encryption monetary advisory committee will help build US BTC reserves) US president-elect Trump has introduced a series of policies aimed at promoting economic growth, including tax cuts, high tariffs, and deregulation of businesses, but according to CNBC, these policies may cause concerns about soaring consumer prices. Strategists warn that this could lead to significant changes in bond yields and investor behavior, and a repeat of the scenario of the UK mini-budget crisis in 2022 is not impossible. Alim Remtulla, head of strategy at EFG International Forex, said overseas central banks and institutional investors, traditional buyers of U.S. 10-year Treasuries, are gradually reducing their reliance on U.S. Treasuries due to concerns about inflation, debt and geopolitical-related depreciation risks: Therefore, more price-sensitive investors need higher yields to invest in Treasuries. Although it has not yet reached the point of crisis, as the dollar still outperforms other currencies, there are real concerns that the US may experience sharp monetary and yield fluctuations, as the UK did in the fall of 2022. A repeat of the UK mini-budget crisis? Britain's mini-budget crisis refers to a period of turmoil under former Prime Minister Liz Truss and former Chancellor of the Exchequer Kwasi Kwarteng. Truss and Kwarteng announced a large-scale tax cut plan through an unscheduled fiscal announcement shortly after taking office in early September 2022, resulting in a big dump in government bond prices, which brought the exchange ratefall of the pound against the dollar to an all-time low, while the sharp dumping of British gilts also prompted the emergency intervention of the British Central Bank, and the two resigned less than 2 months after taking office due to this turmoil, Most policies were subsequently withdrawn. Althea Spinozzi, head of fixed income strategy at Saxo Bank, said that Trump's return to the White House has the potential to profoundly reshape the U.S. bond market, especially as Treasury yields continue to climb due to market adjustments to inflation expectations, and she believes that the Benchmark 10-year U.S. Treasury yield may break the 5% threshold, although she did not specify a specific time, but she described this yield as having a magnetic effect in the current economic environment: Trump's election as president will also bring Exchange The shadow of RateFluctuation. Concerns about the US fiscal position, coupled with increased borrowing to finance tax cuts and spending, could trigger US debt dumping concerns, just like the turmoil in the UK in 2022. Althea Spinozzi stressed that the status of the United States as the world's reserve currency and the depth of the Treasury market provide some resilience, but the continued yield rise could weaken the dollar's strength, especially if inflation expectations spiral out of control or global investors start looking for alternatives. Paul Ashworth, chief economist of North America at Capital Economics, analyzed that although the US version of a mini-budget crisis is not completely impossible, the dollar's status as a global reserve currency makes a sudden crisis less likely: However, the so-called term premium in US bond yields is likely to increase, suggesting that investors are becoming slightly uneasy about absorbing more bond supply. Trump nominates BTChardcore fan Howard Lutnick as Commerce Secretary, and the new SEC chairman will be an encryption-friendly lawyer? Trump shouted: When he takes office, he will use the US military to deport illegal immigrants on a large scale, and the shrinking labor force may lead to a resurgence of inflation? If Trump establishes a BTC strategic reserve, "I am afraid of self-destruction" of the US dollar's hegemony: A gift to China and Russia [Experts warn: the United States may repeat the UK's 2022 mini budget crisis! The US dollar is violently shaking, and the yield of treasury bonds is soaring" This article was first published in BlockTempo "Dynamic Trend - The Most Influential Block Chain News Media".