U.S. Treasury Yield Stability Suggests Limited Decline Potential

According to PANews, analysts Daniel von Ahlen and Adrea Cicione from TS Lombard have observed that the term premium, which represents the additional yield investors demand for holding longer-term U.S. Treasury bonds, has remained relatively stable. This stability indicates that the yield on 10-year U.S. Treasury bonds is unlikely to fall below 4%. They argue that without a significant compression in risk premiums, there is limited room for further yield declines. Furthermore, the analysts suggest that the Federal Reserve is unlikely to lower interest rates below 3% in the next easing cycle, which would continue to support higher yields. This outlook reflects the current economic conditions and monetary policy expectations, emphasizing the constraints on potential yield reductions in the near term.