Treasurys

US bonds have been whipsawed this month as President Donald Trump's move to impose global tariffs raised threats to the economy, undermining Treasuries' reputation as the world's safest asset.

The rebound in bonds eased concerns that built last week, when a steady rise in yields threatened to deal the US economy another hit by pushing up the cost of all kinds of loans.

Bessent reiterated his interpretation of the decline being mainly a product of deleveraging, saying he had no evidence that sovereigns were behind the drop.

Investor confidence in US bonds can no longer be taken for granted — not after a years-long borrowing binge, not with a president hell-bent on rewriting the rules at home and abroad and antagonizing many of the country's biggest creditors.

The yield on 30-year Treasuries briefly pushed over 5% in Asia and the pressure seeped into other markets, with yields rising sharply in Australia, the UK and in the developing world.

It's bringing back memories of the basis-trade unwinds at the onset of the pandemic — when widespread deleveraging sparked blowups of the popular hedge fund strategy that sent bonds tumbling.

In Germany, the 10-year bund at 2.66% reflects the prospect of a flood of bond issuance as the government ramps up defense spending.

The bid for havens also saw traders boosting bets on Fed interest-rate cuts, fully pricing in a quarter-point move by June.

The ceiling kicked back in at the start of the year, since when the Treasury has been using special accounting maneuvers to make good on all obligations on time.

Leading up to President Donald Trump's April 2 deadline on levies, the options traders prefer to own exposure to US government debt due in five years.