📈 1. Current Status of 10-Year U.S. Treasury Yields
The 10-year U.S. Treasury yield has recently maintained at 4.38%, almost unchanged from the previous trading day.
Compared to the same period last year (approximately 4.25%), it remains high, currently slightly above its long-term average (approximately 4.25%).
📉 2. Yield Curve and Short-Term Interest Rates
The spread between the 10-year and the yield is approximately +0.44 percentage points, indicating a slightly positive slope of the curve, but below the historical average (approximately 0.8 pp).
High short-term interest rates (2-year, 3-month, etc.) reflect a hawkish Fed policy, but the curve has not significantly inverted.
🔧 3. Analysis of Influencing Factors
Inflation and tariff pressures
Commodity and tariff pressures are raising medium-term inflation expectations, suppressing long-end rate declines.
Concerns about government bond issuance and supply
The Fed's balance sheet reduction and the expansion of government fiscal deficits may drive up bond issuance and their yields.
Geopolitical and safe-haven demand
Recent tensions in the Middle East have led to some safe-haven funds flowing into government bonds, pushing down yields; however, the extent is limited.
Changes in Fed policy expectations
Although the Fed reiterated that there may be two rate cuts in 2025, the high inflation risks and political interference make short-term interest rate expectations unstable.
🔭 4. Market Outlook
SocGen predicts that 2Y and 10Y rates will remain high in 2025, emphasizing that stablecoins and other emerging funds may become a support.
Reuters surveys show: it is expected that within 3 months, the 10Y will fall to ~4.35%, and in 6 months to ~4.29%, but there are still upward pressures in the medium to long term.
CapitalSpectator suggests there is still a 70 bps premium space between the current 10Y and the model's 'fair value' (approximately 3.72%).
🧾 5. Recommendations for Investors
Yield level: the range of 4.3–4.5% can be seen as a stable zone after the market digests high inflation concerns and issuance worries.
Strategic deployment: the bond allocation portfolio can adopt a 'gradual accumulation' strategy, especially as a long-term core income tool.
Risk management: continue to monitor Fed statements and data (PCE, employment, tariffs), changes in bond supply, and geopolitical trends.
Overall allocation: moderate term gradients can be maintained in the portfolio (e.g., 2-year steady income, 10-year higher income) to balance returns and risks.
✅ 6. Summary
By the end of June 2025, U.S. Treasury yields are expected to stabilize at high levels, primarily driven by inflation, tariffs, and government fiscal expectations; at the same time, Fed expected rate cuts and fiscal expansion lead to increased supply, supporting current interest rate levels.
In the short term, the 10-year yield remains at 4.3–4.5% levels, showing signs of decline, but in the medium to long term, it may rise due to deficits and inflation.