TechFlow, May 12 — According to Jinshi Data, Goldman Sachs economists stated in a report that their fundamental assessment of the U.S. economy continues to support the core view that "short-term Treasury yields will decline and the yield curve will eventually steepen." However, if solid economic data fails to support market expectations for Federal Reserve rate cuts, near-term market pricing for rate cuts may continue to weaken.
If confidence in the scope for rate cuts gradually fades amid persistently high inflation and economic data that has not yet deteriorated enough to prompt Fed easing, then as government debt continues to accumulate, term premium could face greater upward pressure, thereby pushing yields higher.
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