Analyst: US Tax Cuts Expected to Put Pressure on Long Term US Debt

On July 17, Arif Hussain, head of the fixed income department of T. Rowe Price, pointed out that the adoption of Trump's "Beautiful Bill" is expected to lead to an increase in the basic deficit of the United States, thus putting pressure on the long end of the treasury bond yield curve. He said, "Tax cuts will keep the US fiscal deficit high for the foreseeable future and put pressure on the long end of the US Treasury yield curve." One qualitative consideration that could worsen the situation is that if the US no longer plays the role of a "global policeman," the expected increase in foreign demand for US Treasury issuances in the future will be questioned. In this context, T. Rowe Price suggests that US Treasury bonds with maturities of 10 years and longer may face significant pressure. (Golden Ten)