US Treasuries Bonds Returned 5.8% This Year, Higher Than Other Economies
Tuesday, September 16th, 2025.
US Treasury Yields Lead Global Bond Markets Ahead of Expected Fed Rate Cuts: The strong performance of US Treasuries, which returned 5.8% this year, is of significant interest to New York's financial institutions and investors. The outperformance is driven by expectations that the Federal Reserve will cut interest rates to address a dwindling economy.
Despite earlier worrying sentiment, US Treasury bonds have outperformed global markets in 2025, with a According to GuruFocus 5.8% return, the highest among the world's 15 largest debt markets when measured in local money.
Anticipation of Federal Reserve Rate Cuts: The primary driver is the market's expectation that the Federal Reserve will cut interest rates to address a slowing economy. This anticipation has reversed earlier bearish views on US debt.
Weakening US Dollar: US dollar has made overseas assets more attractive for dollar-based investors.
Global Market Challenges: Weakening sentiment in other global markets, including rising fiscal deficits in Europe, a relatively medium confidence of the Bank of Japan, and a surge in Chinese stocks, have contributed to the relative strength of US Treasuries.
Weakening US Economic Data: As reported by Moomoo US jobs data, in particular, has softened, increasing the likelihood of Fed rate cuts and bolstering demand for safe-haven US bonds.
Future Prediction
Continued Rate Cuts: Analysts anticipate the Fed will cut rates multiple times this year, potentially starting this week, further supporting the bond market.
Shifting Focus: The market's focus has shifted from inflation concerns to the potential for an economic slowdown, further bolstering the case for US Treasuries.