CITIC Construction Investment: US bond yields are unlikely to rebound

The China Securities Construction Investment Research Report pointed out that after the Federal Reserve cut interest rates, the 10-year US bond yield rebounded to 4.2%. The research report believes that the risk of US bonds is significantly smaller than last year, and short-term yields may rebound, but the central bank still fell back to 4% or even lower at the end of the year, and can wait for the opportunity to intervene. The sharp decline in US bonds in Q4 last year and Q2 this year was caused by Trump's impact, but the transmission path is different: after the interest rate cut last year, the main reason for interest rate reduction expectations was suppressed; after the tariff this year, the main reason for the term premium was revalued. At present, the risk of trade easing, interest rate cuts restarted, credit decline and easing suspension is small. The overall environment of US bonds is better than before, and the yield center is not optimistic about a sharp rebound.