FAQs:What significant risks are being faced by the US bond market in 2025? What is being assigned by Apollo Chief Economist Torsten Slok regarding the Federal Reserve? (You can now subscribe to our(You can now subscribe to our Economic Times WhatsApp channelUS bond markets are actually facing some significant risks in the year 2025 with potential for a ‘Liz Truss moment’ triggered by the fiscal policies of the incoming US President- elect Donald Trump administration, reported Business Insider. Adding onto that, Torsten Slok actually highlights an unusual phenomenon where bond yields are rising as the Federal Reserve cuts rates while suggesting severely underlying economic tensions.The proposed combined spending and tax cut bill of US President- elect Donald Trump could actually dramatically increase the deficit spending while potentially sparking a bond market rebellion, asserted Business Insider. At the same time, the market is already grappling with quantitative tightening unsustainable fiscal deficits and high Treasury issuances.Torsten Slok gradually assigns a 40% probability of the Federal Reserve raising interest rates in the year 2025, which would be actually a shocking development for investors expecting rate cuts.

Source: The Times January 09, 2025 17:05 UTC