Surging Treasury Yields: After Trump’s win, U.S. 10-year Treasury yields rose nearly 15 basis points. Analysts predict these long-term yields could climb further, spurred by tax cuts and tariffs, which are expected to boost inflation and raise costs of imported goods.

Debt Surge Alert: Trump’s policy pledges could increase the U.S. fiscal debt by $7.75 trillion in the next decade. Rising fiscal deficits may push yields higher as bond investors demand a premium to offset potential inflation.

Fed’s Cautionary Stand: With robust economic data and inflation pressures rising, the Fed may be limited in cutting rates as much as anticipated. Traders now expect only three additional rate cuts by the end of 2025, indicating cautious Fed policies under inflationary threats.

Yield Curve in Focus: Nearly 95% of analysts expect the yield curve to steepen, with long-term yields likely to rise faster than short-term ones. This “bear steepening” trend could indicate heightened growth and inflation risks ahead.

Clarity Needed on Policies: The bond market awaits more specifics on Trump’s economic strategies, particularly around tax and tariff plans. This policy clarity will help shape a more concrete yield outlook as markets assess the full impact of Trump’s return.

Strategists on Watch: Analysts stress that if Trump’s policies favor high spending without equivalent offsets, it could lead to rapid yield hikes, impacting bond prices and the overall economy.