The "basis bomb" of US Treasuries has detonated a second time, and the cash-out frenzy is comparable to March 2020.

Not again! Previously, after Trump's reciprocal tariffs were officially implemented at noon on Wednesday Beijing time, the frantic surge in U.S. Treasury yields triggered by the collapse of the basis trade attracted global attention, when the 30-year swap spread collapsed, and the riot in the U.S. bond market that day was also considered one of the factors that persuaded Trump to withdraw most of the reciprocal tariffs late that night.

By Friday, this ticking time bomb was hissing again, returning to the position before Trump's reversal of the tariff policy, and as a result, the market once again faced a triple whammy of stocks, bonds, and currencies.

This week's move likened to a frenzied "cash-out spree" in March 2020, when the plunge in the U.S. Treasury market forced the Federal Reserve to step in a massive $1.6 trillion bond-buying bailout. The magnitude of the sell-off highlights the fragility of key markets and is similar to the mini-budget crisis that triggered a sharp drop in UK bonds in 2022.

The Federal Reserve is now refusing to face the looming deflationary whirlpool, stubbornly waiting for June when Trump's tariffs will push the CPI up by 0.1%. However, since the beneficiaries will be some of the world's richest hedge funds, this could become a problem... This brings to mind what Deutsche Bank's George Saravelos said two days ago: the only shortcut to the current funding crisis is to initiate quantitative easing. This certainly means a victory for Trump (and Bessent). Now we wait to see who will be the winner of the world's largest coward game.
#CPI数据来袭 #加密市场反弹 #特朗普暂停关税 #BTC