Institution: If Trump is elected, future interest rates may be higher than expected
ChainCatcher news, according to Jinshi reports, three weeks ago, the Federal Reserve cut interest rates by 50 basis points and hinted at further cuts, but during this period, investors pushed the 10-year U.S. Treasury yield up to 4%, the highest level in two months. Why are long-term interest rates rising while the Federal Reserve is cutting rates? There are two reasons that suggest interest rates over the next 10 years may be higher than in the previous decade, and possibly much higher.One reason is relatively mild. Inflation and economic growth are unlikely to be as low as they were before the pandemic. The second situation is less favorable. Federal debt is on an unsustainable path, which could become more dangerous after the election, especially if former President Trump wins and Republicans control Congress. Both Harris and Trump have proposed large-scale spending and tax cut plans that would significantly increase debt.However, CRFB Chair Maya MacGuineas stated, "Neither has any plan to address the overall debt, but it is clear that Trump's agenda would be much worse than Harris's agenda."