US Deficit Steepener Yield Pressure
The lack of a sustainable deficit control plan in the U.S. will contribute to a steepener bias within the Treasury curve.
Too little corroboration in the last 3 days to call a trend (3 articles). Watching for it to gain traction.
"Forward guidance in general has served to suppress volatility and anchor market expectations, and that has led to lower borrowing rates, relative to alternatives. Still, the impact on consumers is likely to be modest, Pearkes added, with mortgage rates perhaps a quarter-point higher than they would be otherwise."
"Issuing short-term securities initially seemed prudent, but the flattening yield curve and potential Federal Reserve rate hikes expose this strategy's vulnerabilities."
""We still don't have a sustainable and credible plan for deficit control here in the U.S., so that should show up fundamentally as a steepener bias within the Treasury curve," Khanduja said."