US President Donald Trump | Photo loan: Eduardo Munoz

Was the U.S. President Donald Trump’s U-President Donald Trump to escalate the trade war by threatening high tariffs on the EU and the iPhone manufacturer Apple in a week when the US-CAM reached 30-year financial return since 2007, just one coincidence? Because if you return to the beginning of April a few weeks ago, he made a similar U -turn a week to pause the mutual tariffs for 90 days a week.

At that time, the veteran of the Bond market, Jim Bianco, published on X, in which the irresistible power of the binding market was emphasized by quoting James Carville (Bill Clinton’s political consultant): “I thought in the past when there was a reincarnation, I wanted to come back as president or Pope.

After all, the interest rates of borrowers (state and private) increase, when the bond of sovereign bond increases, all financing costs increase accordingly. All of this also have an impact on stocks/reviews, although you may need time to play off.

Trump was again made aware of the Bond Vigilantes last week. The problem for him is that it is now becoming a frequent event – first in early January this year, then in April and now again!

Dual call

In the past few weeks there has been what can be described as a double conversation or misleading contradictory signals on the Trump government’s economic agenda. From the beginning of Trump 2.0 until mid-April and especially in days of deep correction in the markets after mutual tariffs, the finance minister Scott Bessent was urgently on the fact that the US economy needed “detoxification” of excessive state expenditure.

The bond market loved these and long-term returns of the government bonds until the beginning of April, when some unexpected and disordered winding of the positions led to the returns climbed again (while there were views that this may be due to the fact that China sold US bonds for retaliation duties at US tariffs, the final judgment is not yet issued).

In the past few weeks, however, the administration has been working hard to insist on a great nice calculation that focuses on tax cuts, which will also increase the debt limit. Bond investors seem to be frightened again. Especially if this happens against the background of the US reviews.

Last week Bessent said that the United States would deal with debt by ensuring that the economy would grow faster than the debt. This means that he is not looking for “detoxification” in the economy, but that it becomes faster.

This is a complete postponement of your agenda. The most important thing to consider here is that it now seems that Trump in a position of “damn it, if you do it and damn it if you couldn’t do it”.

Escaling tariff wars cause the fear that China or other countries could connect through the sale of finance ministries, while the tariff wars in combination with an increase in the debt limit cause concerns that the economy arise and inflation of inflation, which leads to the current Bond tension.

While Trump’s escalation of Trump’s tariff war last Friday could have its roots to cool the bond yields by aiming to the euro zone and not to the three largest owners of US finance bonds -Japan, Great Britain and China -the risk that his administration may lose control of the narrative when the flip -flops continue.

Japanese bonds

Pressure now is Bond insertion in Japan. The Japanese 30 -year bond delivers last week and at the highest level. With the pressure on the Japanese government (largest owner of US state bonds) and private investors to rethink their US finance ministries.

As it is, a falling $ and falling US bond (US -Rendits Spike) is a double strike for the value of your US bonds. This is now combined with its domestic bond market, which makes Japanese bonds more attractive. Therefore, after some macro experts there is a risk of a similar type of volatility caused by the handling of the Yentresse in August last year.

Stock markets

All factors mentioned above now have a strong hurdle for us and global stock markets. The strong recovery in Dow Jones, S&P 500 and Nasdaq Composite from the deep stalls in April is expected to reverse from here if the bond yields continue to increase. It would be worth noting that the US indices last Thursday at 1 p.m. New York recorded a sharp reversal of the intra day to the disadvantage when an auction for new 20-year bonds worth $ 16 billion recorded a weak demand and rose the returns.

The Indian bond markets reflect a calm of calm in these tantrums. However, the risk of domestic capital investors can be attributed to how the FPIs are now reacting.

In the meantime, gold could still find customers if the uncertainty is.

Published on May 24, 2025