2010: The U.S. bond market, "Bear" coming?

2010: The U.S. bond market, "Bear" coming?
http://www.shiweilai.com 2010-1-7 10:19:00 shiweilai


With the U.S. economic recovery and the unemployment rate has slowed down, more than a dozen Wall Street investment banks have predicted that the U.S. bond market performance will not optimistic.

A huge deficit and pushing up bond yields

U.S. Treasury prices soared 14% in 2008, later, in 2009, down 3.72%, while the Standard & Poor's 500 Index rose 23.5% in the final in 2009.

As the U.S. government 2.11 trillion U.S. dollars last year, high debt, investors for the bonds issued by the Government's new interest in getting lower and lower, while the cost of financing government bonds have become increasingly high. Barclays Bank fixed-income investment strategist, said that with the further increase in the government budget deficit, national debt trend will be further suppressed. Goldman Sachs Group, JP Morgan Chase and a number of Wall Street investment banks have also released a report predicts that in 2010 the U.S. 10-year bond yields 3.84% in 2009, based on increased further to 4.14%.

The unemployment rate steady increase in rate hike expectations

Fed's federal funds target rate was kept at near-zero level has more than a year market for a long time loose monetary policy may lead to concerns about inflation risks continue to increase.

December 16 last year, the Federal Reserve Open Market Committee (FOMC) has the outside world that it would be phased in March this year, the termination of an emergency loan assistance schemes and the purchase of bonds on the open market. After the Federal Reserve again raised December 28, deposits to the bank to sell bills to the progressive recovery of the excess liquidity in the market to prevent the rise of inflation.

Left the program for these preparations, fixed-income analyst at Nomura Securities Lijia Yuan for "First Financial Daily" said that the investors can not expect such a low interest rate environment will continue indefinitely. She said that the right interest rate and monetary policy, the most sensitive of the two-year yield to 0.77% from a year ago, rose to 1.14%, indicating that the market expected the Federal Reserve will raise interest rates this year, a significant increase.

Directed against a number of investment banks on Wall Street analysts survey also showed that the U.S. unemployment rate peaked in the near future, after a gradual decline, the Fed is likely to raise the benchmark rate by 2010, up 0.75 percentage point.

The impact of the bond market Ying

Relative to the bond market's pessimistic expectations, more than 15 large brokerage houses this year is relatively optimistic about the U.S. stock market movements. From JP Morgan Chase and Goldman Sachs stock this year, investment strategist at Standard & Poor's index are expected to increase up to 9.8%, showing an absolute leader in the bond market index.

Barclays Bank economist forecasts GDP growth this year, the United States is expected to reach 3.5%, while the 10-year bond yields will rise to 4.5%. Morgan Stanley's fixed-income market, analysts are given the highest valuation of the 10-year bond yields - 5.5%.

Analysts said that in 2010 the Fed will no longer be buying a large number of various types of bonds issued by the Ministry of Finance, on the contrary there this year, the Fed may sell as much as 2.5 trillion U.S. dollars of various types of bonds, TIPS bonds, which would cause a huge impact on the bond market .