On 13/05/2025, the story of trade tensions gradually cools due to conciliatory moves from the Trump administration, but a new challenge arises: U.S. government bond interest rates continue to climb, putting significant pressure on the president. Is this a difficult puzzle for the U.S. economy? Let's analyze in detail.


Context: Bond Refinancing with High Interest Rates

In 2025, the United States must refinance about $9 trillion in maturing government bonds, accounting for 25% of the total federal debt currently at $36.8 trillion. Previous debts were issued at an average interest rate of about 2.7%, but given the current situation, refinancing rates could reach 4.45%. This raises annual interest costs from $245 billion to over $500 billion—nearly doubling—creating a massive financial burden on the federal budget.


USDX, an index measuring the strength of the USD, surpassed 100 on 08/05 and temporarily peaked at 101.97 late on 12/05 (data from #FXCE ), reflecting increased pressure on this currency as bond interest rates climb, enhancing the appeal of the USD in the international market.


Challenges for Trump: Interest Rates Not Easy to Reduce

The president #TRUMP expects interest rates to decrease to ease the debt burden, but the current situation puts him in a difficult position:



  • As trade tensions escalate: Countries are concerned about selling U.S. bonds, driving interest rates up due to excess supply.

  • As trade stabilizes: Investors shift to stocks to capitalize on growth momentum, offloading bonds, causing interest rates to continue rising.


  • When things are quiet: Interest rates remain high because the Federal Reserve has not taken steps to lower them, maintaining a tight stance to control inflation.



In reality, the Fed is at the center of the issue. Keeping interest rates unchanged (as the decision on 08/05) although aligning with market expectations, does not meet the demand to reduce the financial pressure on the Trump administration, especially as interest costs are expected to soar.


Impact on Financial and Crypto Markets

The rise in bond interest rates not only affects the U.S. budget but also spills over into other sectors:



  • Stock Market: Technology and industrial stocks (such as Dow, S&P 500, Nasdaq) surged due to positive trade news, but high interest rate pressure could hinder long-term growth.


  • Crypto Market: Bitcoin ($104,000) and Ethereum ($2,500) benefit from reduced risk appetite, but high interest rates may lead investors to shift to bonds, reducing cash flow into digital assets. Crypto fund inflows reached $3.4 billion last week, but the forecast of accumulating $330 billion into Bitcoin by 2029 could be affected if the Fed does not ease.


  • Altcoin: Solana ($146) and $XRP ($2.31) also face risks from capital outflows.



Future Prospects

If the Fed maintains high interest rates for the next 1-2 years, America's debt costs will continue to rise, forcing the Trump administration to weigh the trade-off between controlling inflation and stimulating the economy. However, if global trade stabilizes and the Fed lowers interest rates (based on positive economic data), the pressure may ease, paving the way for financial and crypto growth. USDX at 101.97 indicates temporary strength, but subsequent volatility depends on Fed policy.


Conclusion: Will U.S. Bond Interest Rates Shape the Economic Future?

Even as the trade war cools, high U.S. bond interest rates—with interest costs expected to exceed $500 billion—become a major challenge for Trump. USDX peaked at 101.97 on 12/05, reflecting financial pressure, while the Fed plays a decisive role. The crypto and stock markets may benefit in the short term, but long-term prospects depend on the Fed's actions. Investors should monitor closely to adjust their strategies.


Risk warning: Financial and crypto investments carry high risks due to price volatility and economic instability. Please consider carefully before participating.