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DailyU warns on US bonds
A report from billionaire Ray Dalio warns that the U.S. Treasury bond market could face additional pressures if China and Japan reduce their roles as major lenders to the United States. Such a move could lead to a significant increase in borrowing costs. He explained that the U.S. depends on foreign capital to finance about one-third of its debt, and a decline in funding from China and Japan—who hold a large portion of the bonds—could raise yields and add tension to the bond market. Additionally, the rise in Treasury yields to 5.3%, the highest since 2002, reflects falling bond prices and increased risks associated with U.S. debt. This situation has been exacerbated by declining confidence due to inaccurate Treasury forecasts and repeated optimistic statements that have not materialized, thereby undermining their credibility and making the market more sensitive to debt and fiscal deficit risks.
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