Nordea Bank: The US election results mean that US bond yields will have greater upside potential in the next 1-2 years.

According to a report by Joakim Bornold, chief strategist at Swedish bank Nordic Corporate Bank, the bank's research department has always expected US Treasury yields to rise until 2025, regardless of the outcome of the US election. However, he said that the election results mean that US Treasury yields will have more upward potential in the next 1-2 years. He pointed out that this is because the Fed's interest rate cuts will be more cautious than previously expected in response to higher inflation and larger budget deficits. He said: "Larger deficits will bring more upward pressure on long-term yields." This will be reflected in further increases in long-term risk premiums. (Jin10)