Deutsche Bank: The Fed may conduct emergency QE to curb turmoil in the U.S. bond market

Odaily Planet Daily News Deutsche Bank said that if the turmoil that once pushed the United States' long-term borrowing costs to more than 5% continues, the Federal Reserve will need to step in to stabilize the U.S. Treasury market. On Wednesday, escalating doubts about the safety of U.S. assets due to Trump's tariff war exacerbated the sell-off of U.S. Treasuries, and the yield on the 30-year Treasury bond rose to 5.02%, the highest level since November 2023. If this situation continues, the Federal Reserve will need to intervene, which George Saravelos, the bank's global head of foreign exchange strategy, called a "circuit breaker mechanism" - that is, emergency quantitative easing. "If the recent turmoil in the U.S. Treasury market continues, we believe that the Fed will have no choice but to urgently purchase U.S. Treasuries to stabilize the bond market." He wrote. (Jinshi)