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US Bonds Yields to Deflate values


According to the US Federal Reserve, the U.S. GDP growth will rise to 3.1 percent in 2018, 2.5 percent in 2019, and 2.0 percent in 2020. Over this period the core inflation rate will rise from 2.0 percent in 2018, to just 2.1 percent in 2019 and 2020, which will provide the Fed some room to move interest rates if the US dollar surges in the mean time. Currently US rates are expected to increase to 2.5 percent in December 2018, 3.0 percent in 2019, and 3.5 percent in 2020.

Treasury yields are however expected to increase as the demand for the US dollar increases. Yields on 10-year US Treasuries surged to a seven-year high of 3.22 per cent this week after the Federal Chairman said the US economy was firing on all cylinders and issued fire-breathing comments on interest rates.

FITCH Ratings took hold of this comment and warned that global bond markets face a rude shock if the US Federal Reserve jams on the brakes to avert overheating, with grave