United States Government Bond 10Y

World gold prices recovered more than 1% to stand back above the $4,600 per ounce level on Thursday, as markets awaited a speech by Kevin Warsh, the Federal Reserve Chair, at the Jackson Hole meeting on Friday. Gold prices rose 1.1% to $4,639.45 per ounce at 10:17 a.m. Singapore time, after declining on Wednesday due to U.S. inflation data exceeding the target, which increased market expectations of a Fed rate hike, strengthening the dollar and pushing bond yields higher. However, gold prices are still up nearly 15% in August, supported by the U.S. Treasury's intervention in the bond market, which has spurred interest in the 'debasement trade' strategy. Investors are using gold as a hedge against budget deficits and a weakening dollar. Analysts at Zijin Tianfeng Futures noted that gold prices remain above the 200-day moving average, a sign of strength, and if Warsh does not signal a rate hike in September, the market may interpret it as dovish, which would be positive for gold. Additionally, the independence of the Fed is a key focus, following Fed Governor Lisa Cook's denial of allegations of mortgage fraud, amid President Trump's efforts to remove her from her position. Among other precious metals, silver rose 2% to $69.49 per ounce, while platinum and palladium also gained.

Spot gold prices fell 1.4% to $4,592.97 per ounce after US inflation data came in close to expectations, increasing bets that the Fed will raise interest rates next month. Meanwhile, the dollar strengthened 0.3%, making gold more expensive for holders of other currencies. US gold futures declined 0.9% to settle at $4,653.30 per ounce. The PCE index rose 3.7% in the 12 months through July, higher than the 3.6% economists had forecast. Investors see a 38% chance of a Fed rate hike next month, up from 36%. Peter Grant, vice president of Zaner Metals, said gold's uptrend is returning, and he sees the possibility of prices climbing back above $5,000 this year, with expectations that gold could hit a new record high within the second quarter of 2027.

GCAP GOLD stated that gold prices are moving steadily at high levels near $4,650, despite facing pressure from a recovering dollar, ahead of the market digesting U.S. PCE data. Gold selling remains limited as U.S. Bond Yields continue to decline, amid reduced expectations that the Fed will raise interest rates at its September 15-16 meeting, following easing inflation pressures and signs of a slowing labor market. Meanwhile, Middle East risks are easing after Iran returned to negotiations with Oman regarding the management of commercial shipping through the Strait of Hormuz, leading oil prices to fall near two-week lows, which reduces short-term safe-haven demand for gold. However, lower oil prices help alleviate inflation concerns and pressure Bond Yields, which could limit gold's downside. Thus, the impact on gold remains offsetting rather than a one-sided negative factor. For the next direction, the market is focusing on U.S. PCE data and remarks by Kevin Warsh at Jackson Hole on Friday, which will indicate a new momentum for gold. It is viewed that if PCE does not accelerate beyond expectations and the Fed does not signal additional hawkishness, the environment remains favorable for gold, given the limited recovery in Bond Yields and the dollar, opening the way for prices to retest $4,700 again. The key risk is higher-than-expected PCE, which could lead the market to increase bets on tighter monetary policy and trigger profit-taking in gold.

The Federal Reserve Bank of Kansas City's economic symposium, the Jackson Hole Meeting, will be held from the 27th to the 29th in Wyoming, where newly appointed Fed Chair Warsh will deliver his first speech on the 28th. The latest July Consumer Price Index (CPI) rose 3.4%, slowing for the second consecutive month, but the Trump administration's intensified sanctions on Iran and disruptions in the Strait of Hormuz have kept gasoline prices elevated, fueling early rate hike speculation. Additionally, concerns over fiscal deficits and prolonged inflation, along with increased funding demand from the AI boom, pushed the 30-year Treasury yield to a 19-year high of over 5.3% last week. Bank of America warned that if the speech does not address measures to curb inflation, the 30-year yield could surge to 5.5%. With the focus on whether a September rate hike will occur, Warsh's remarks have added to policy uncertainty, and the market is watching whether he will mention a review of communication methods.

US personal income rose 0.4% month-over-month in July, unexpectedly expanding, while personal consumption expenditures slowed to 0.2% month-over-month, the lowest growth so far this year. The July PCE price index accelerated to 0.2% month-over-month and 3.7% year-over-year, and the core PCE price index also accelerated to 0.2% month-over-month and 3.3% year-over-year, but there is no overheating in price increases, and they may have passed their peak. This has strengthened expectations that the Federal Open Market Committee (FOMC) will hold the policy rate steady. On the 28th, Chair Warsh is scheduled to speak, with attention particularly on his remarks following Treasury Secretary Bessent's announcement of support for the Treasury market. According to a CNBC survey, 80% of experts said the Chair should present an economic outlook, and 77% believe the Treasury's bond market intervention will fail to lower long-term rates.

In the New York market on the 26th, the dollar rose against major currencies and Treasury yields also increased after US inflation data came in above expectations. Meanwhile, the stock market edged lower ahead of Nvidia's earnings release. The Commerce Department reported that the Personal Consumption Expenditures (PCE) price index for July rose 3.7% year-over-year, exceeding the market forecast of 3.6%. Following this, according to CME FedWatch, the probability of a rate hike at the September FOMC meeting rose to about 40%. The 10-year Treasury yield rose 2.93 basis points to 4.668%. In the stock market, the Dow Jones Industrial Average fell 113.52 points to close at 53,463.88, while the Nasdaq dropped 21.10 points to 26,130.20. Gold futures continued to decline due to stronger rate hike expectations, with the front-month contract falling 0.9% to $4,653.30 per ounce.

The U.S. Commerce Department's release on the 26th of the personal consumption expenditures (PCE) price index for July, which rose more than market expectations, has somewhat strengthened expectations of a rate hike at the Federal Reserve's September meeting. The July PCE price index rose 3.7% year-on-year, exceeding the economist forecast of 3.6% compiled by Reuters. On a month-on-month basis, it rose 0.2%, also exceeding the forecast of 0.1%. In response, the probability of a rate hike at the September Federal Open Market Committee (FOMC) meeting, as implied by interest rate futures markets, rose to about 44% from about 36% before the PCE release. The market also fully prices in the view that the Fed will proceed with a rate hike within the year.

The Dow Jones Industrial Average was nearly flat today, with investors holding back on trading while awaiting Nvidia's earnings and a speech by Federal Reserve Chair Kevin Waller at the Jackson Hole symposium, which will mark his first address at this venue. The market was pressured by a higher-than-expected PCE index, which could prompt the Fed to accelerate interest rate hikes in October. However, the Dow edged up 12.67 points, or 0.02%, to 53,590.07. Meanwhile, the FedWatch Tool indicated that investors assign a 54.7% probability that the Fed will raise rates by at least 0.25% in October, up from 46.4% last week. On the data front, the U.S. Commerce Department reported that the overall PCE index rose 3.7% in July year-over-year, above the expected 3.6%, while core PCE increased 3.3%, in line with forecasts.

As Bitcoin fell 1.9% on rising U.S. Treasury yields, Ethereum declined only 1.6%, maintaining a level above $2,400. U.S. spot Ethereum ETFs saw inflows totaling approximately $1 billion over nine consecutive trading days, and Bitmain Immersion Technologies purchased an additional 32,447 ETH. While the amount of ETH waiting to enter staking increased by 1.28%, traders in prediction markets still hold positions anticipating further price declines. ETF inflows and Bitmain's buying have supported the market, keeping ETH above $2,400.

US stock futures edged lower today as investors reduced risk ahead of Nvidia's earnings release and the Personal Consumption Expenditures (PCE) price index. S&P 500 futures fell 0.1%, and Nasdaq 100 futures declined 0.2%, while the 10-year Treasury yield rose 2 basis points to 4.65%, despite oil prices falling for a third consecutive day. Markets are focused on Nvidia's results, due after the close, with options pricing a 5.4% move in the stock and expectations of revenue doubling year-over-year. Investors are also awaiting July PCE data, which economists forecast to rise 3.6% year-over-year, the lowest rate in four months, and a key factor for the Federal Reserve's monetary policy direction.

US Treasury Secretary Bessent's announcement of a US Treasury buyback temporarily lowered interest rates and strengthened the yen, but market reaction was limited, and disappointment over the lack of specifics in the fiscal consolidation plan could trigger a triple decline in Japan: falling US bonds, stocks, and the dollar. The buyback is scheduled from September 9 to November 4, with the per-operation cap raised to between $2 billion and $4 billion (approximately 634 billion yen), but long-term yields have returned to pre-announcement levels. Bessent has said he will soon unveil a fiscal consolidation plan, but without concrete measures, it risks disappointing markets and leading to a triple decline. This week, events include a press conference by Bank of Japan Deputy Governor Ryozo Himino, a speech by Federal Reserve Chair Warsh at the Jackson Hole symposium, and the G20 Finance Ministers and Central Bank Governors meeting, which could destabilize markets from September to October.

Citadel Securities has shifted its view on long-term U.S. government bonds, having previously warned of a downtrend last month. Now, it assesses that risks are tilting toward a recovery in bond prices, with long-term yields likely to decline, as investors have accumulated excessive bearish positions and inflation data begins to show improvement. Frank Flight, head of macro strategy at Citadel Securities, said in a report on Tuesday that the firm now sees market odds leaning toward lower long-term bond yields, a reversal from the previous month when he warned investors to brace for a difficult period in the U.S. bond market. Long-term U.S. government bonds have faced heavy selling in recent weeks due to concerns over inflation, budget deficits, and a large volume of debt issuance, particularly from tech companies raising funds for AI infrastructure investments. This selling pushed the 30-year U.S. Treasury yield to its highest level in nearly 20 years last week, before Treasury Secretary Scott Bessent announced plans to increase buybacks of 10- to 30-year bonds to help ease market pressure. One key reason for Citadel's change in outlook comes from trend-following investment strategy models, such as Commodity Trading Advisors (CTAs), which found that bearish positions on long-term bonds are relatively stretched compared to historical norms. Flight believes this means that if bond prices fall further, there may be limited additional selling, as many investors have already established short positions. Conversely, if bond prices can recover sustainably, short sellers may need to buy back bonds to cover positions, potentially fueling further price gains and pushing yields down. This latest view marks a clear reversal for Flight, who in early July warned that bond market investors were underestimating the commitment of Federal Reserve Chairman Kevin Warsh to fight inflation. At that time, Flight even predicted the Fed might surprise by raising interest rates at its July 29 meeting, contrary to most economists who expected rates to remain unchanged. Ultimately, the Fed held rates steady, but Warsh's post-meeting statements raised questions in the market about the strictness of inflation control and contributed to the sell-off in long-term bonds. However, Flight now believes concerns about the Fed's credibility may be overblown, as recent economic data, including softer employment and inflation figures, are beginning to support a more accommodative monetary policy approach. Another factor supporting the positive view is Citadel Securities' cross-asset model, which examines historical episodes with similar growth and monetary policy signals. Out of 64 episodes since 2003, bond yields declined over the following 120 days in 71% of cases, with an average decrease of about 0.25 percentage points. Flight therefore assesses that after the heavy sell-off in long-term bonds, the risk-reward is now shifting toward a recovery in bond prices and lower yields.

Microsoft shares edged up less than 0.1% to $487.40 Tuesday morning as falling Treasury yields supported the Nasdaq, but the near-flat move signals Wall Street's focus on the enormous bill behind the company's AI buildout. Fiscal fourth-quarter revenue jumped 18% to $90 billion, powered by 43% Azure growth and a 27% increase in Microsoft Cloud revenue to $59.3 billion. Commercial remaining performance obligations exploded 84% to $678 billion, equal to roughly 7.5 quarters of current companywide revenue. The shares trade 15.81% below the $578.95 GF Value estimate, but Microsoft must build capacity, control AI spending, and prove that today's massive capital commitments can generate tomorrow's attractive returns.

Minutes on the discount rate released by the Federal Reserve on the 25th showed that four of the twelve regional Federal Reserve banks supported a quarter percentage point increase in the discount rate in July. The four banks that backed the hike were Cleveland, Dallas, Minneapolis, and Kansas City. The Federal Reserve decided at the July 28 to 29 Federal Open Market Committee meeting to keep the target range for the federal funds rate at 3.50 to 3.75 percent, but Cleveland Fed President Hammack, Dallas Fed President Logan, and Minneapolis Fed President Kashkari argued for a quarter point rate increase and voted against holding rates steady. Kansas City Fed President Schmid does not have a vote at this year's FOMC meetings. The discount rate is the rate applied when financial institutions borrow funds directly from the Fed, and the minutes again showed that views within the Federal Reserve were divided over the appropriate level of interest rates.

Boston Fed President Collins said that prompt tightening would be appropriate unless there is further disinflation. The remarks signal a stance of maintaining the direction of monetary policy tightening. She did not mention specific timing or numerical targets.

U.S. stock futures pointed to a stronger opening on Tuesday, suggesting equities could rebound after the major indices ended the previous session mostly lower. Sentiment improved as crude oil prices extended their sharp decline, with U.S. crude futures falling more than 3% ahead of the opening bell, easing concerns over energy costs and helping push U.S. Treasury yields lower. The sell-off accelerated after the U.S. Treasury Department formally unveiled "Operation Economic Outcast," an unprecedented government-wide economic campaign targeting Iran and its enablers, imposing sanctions on nearly 60 entities, individuals and vessels, though investors appeared relieved that the Treasury did not immediately introduce secondary sanctions against other countries that continue to support trade with Iran. Falling oil prices have also contributed to a further decline in Treasury yields, providing another source of support for U.S. equities. Despite the positive indications from futures, trading activity could remain relatively subdued as investors prepare for several major events later in the week, including key U.S. inflation figures due alongside Nvidia's quarterly earnings and the Jackson Hole economic symposium, where Federal Reserve Chair Kevin Warsh is scheduled to deliver keynote remarks on Friday.

UBS expects the Federal Reserve to leave interest rates unchanged despite competing pressures from a strained housing market and strong artificial intelligence investment. The Federal Open Market Committee voted 9-3 in July to hold the benchmark rate at 3.5% to 3.75%, with three regional presidents voting for an immediate increase. Thirty-year fixed mortgage rates have spiked to 6.66%, a one-year high, with a typical family now spending 34% of income on payments for a median-priced home, according to the National Association of Home Builders. Technology companies are expected to invest $820 billion in data centres this year, spending that UBS says is largely insulated from borrowing costs. Surging memory chip prices linked to AI demand have added 20 to 30 basis points to core inflation, UBS estimates, but the bank considers the effect a temporary bottleneck rather than broader overheating.

The relationship between US Treasuries and emerging-market currencies is diverging from its historical pattern by the most in more than four years, as rising US yields are no longer able to push the dollar higher and pressure emerging-market currencies the way they once did. The Bloomberg US Treasury index is on track for a quarterly loss after investors sold long-dated bonds on concerns about the trajectory of US government debt, while the MSCI emerging-market currency index is heading for its biggest quarterly gain in more than a year. As a result, the correlation between the two assets has fallen to its most negative level since the first quarter of 2022. This sell-off in US Treasuries is not driven solely by expectations that the Fed will tighten monetary policy, but also by concerns about US government debt and budget deficits. Investors are starting to anticipate that the US government may address its debt burden through easing policies and bond buybacks, which could reduce the real value of the dollar over the long term, leading to what the market calls the dollar debasement trade. Currencies of emerging-market commodity exporters are therefore getting a boost, especially South Africa, Colombia and Chile, which have seen the strongest currency gains this month. Nick Rees, head of macro research at Monex Europe, said the dollar debasement trend is making emerging markets look more attractive relative to developed markets, and commodities more attractive relative to equities or bonds.

Krungthai CIO views global equity markets as being in a consolidation phase due to rising bond yields and oil prices, while listed company earnings remain strong. The S&P 500 fell 1.4% and the Nasdaq fell 2.1% last week. The US 10-year bond yield rose 4.2 basis points to 4.73%, and Brent crude oil prices increased 6.6% to 94.4 dollars per barrel. Krungthai CIO recommends a stay invested strategy, gradually accumulating technology and semiconductor stocks during price declines, while maintaining 6 to 12 month gold price targets of 4,915 and 5,315 dollars per ounce.

The options market expects Nvidia shares could see sharp volatility after the company reports second-quarter results on Wednesday, with the stock potentially moving up or down about 5.4% the next day. That would represent a change in market value of roughly $280 billion, more than the market capitalization of about 90% of companies in the S&P 500. The expected volatility is still below the 6.5% level priced in before Nvidia reported results in May, and below the average post-earnings stock move over the past 12 quarters of about 7.4%. Analysts say the lower expectations reflect that investors are starting to see Nvidia's results as more predictable. Chris Murphy, co-head of derivatives strategy at Susquehanna, said the early phase of the AI era, when Nvidia often surprised with results far above expectations and drove the stock up 10 to 20% after earnings, may have passed. Nvidia shares closed lower for a seventh straight session on Monday, though the stock is still up about 11.7% year to date, close to the S&P 500's 11.8% gain, while the Philadelphia Semiconductor Index has surged as much as 61%. Sentiment ahead of the earnings report is also being pressured by concerns about higher energy prices and rising US government debt, which have pushed long-term Treasury yields higher. The 30-year Treasury yield hit its highest level in 19 years last week. Reports that US Treasury Secretary Scott Bessent may use money from the Treasury General Account, which holds nearly $1 trillion, to support bond buybacks instead of increasing new bond issuance helped push the 30-year yield slightly lower on Monday, but it remains above 5%. The rise in yields is putting pressure on growth and technology stocks and has the market focused on remarks by Federal Reserve Chair Kevin Warsh at Jackson Hole this week. For Nvidia's results, investors will focus on revenue guidance, chip demand, profit margins, and whether AI spending by major cloud providers continues to increase, since Nvidia is still seen as a key barometer of the broader AI investment cycle. Nvidia has also recently partnered with six major financial institutions to establish a capital-raising platform for AI infrastructure with a total target value of more than $500 billion, reflecting the enormous sums that companies and governments around the world are pouring into building data centers and AI computing systems. Investors are therefore not only watching whether Nvidia's results beat or miss expectations, but also seeking answers on whether major hyperscaler companies will continue investing in AI at high levels, because that direction will determine both Nvidia's revenue and broader confidence in AI stocks.

US Treasury Secretary Scott Bessent confirmed that the Treasury will proceed with bond auctions as originally planned, avoiding any additional signals about changes to debt management strategy, following reports that it may draw funds from the Treasury General Account, or TGA, to buy back older bonds with high yields. Bessent told reporters that the Treasury has not bought a single bond and that no changes will be made before the next quarterly debt management announcement in early November. Earlier, CNBC reported, citing senior Treasury sources, that the department may use funds from the TGA, which had a balance of 935 billion dollars as of August 20, to buy back bonds instead of issuing additional short-term Treasury bills. Last week, the Treasury announced an expansion of its buyback program for 10- to 20-year and 20- to 30-year bonds from 2 billion dollars to 4 billion dollars per operation between September 9 and November 4, after the 30-year bond yield surged to 5.34 percent, its highest level in nearly 20 years. Analysts at Morgan Stanley estimate that the Treasury may have surplus cash of around 80 billion to 200 billion dollars available to increase bond buybacks, while Goldman Sachs, Wells Fargo, and other financial institutions view the measure as likely to ease pressure on yields only modestly, with new macroeconomic factors needed to help push bond yields lower.

Bitcoin surged past the $80,000 level for the first time since mid-May as confidence returned to the long-sluggish crypto market, supported by the debasement trade, inflows into Bitcoin ETFs, and short covering. Bitcoin rose as much as 2.5% to $80,908 in Asian trading on Tuesday, August 25, its highest level since May 15, after gaining as much as 23% in the seven days through Sunday, marking its biggest weekly advance in about three years. A key catalyst came from Treasury Secretary Scott Bessent's announcement last week that the U.S. government would step up buybacks of government bonds to push long-term yields lower, which spurred dollar selling and renewed investor interest in bitcoin and gold as hedges against currency debasement. Meanwhile, the 13 U.S.-listed Bitcoin ETFs saw combined net inflows of $1.92 billion last week, the highest in 10 months, including a net inflow of $606.3 million on August 20, the largest daily total in more than three months. In addition, a meeting between President Donald Trump and crypto industry executives on the same day Bessent announced the buyback measures helped revive hopes that the U.S. government remains supportive of the digital asset industry. Bitcoin's rapid rally inflicted heavy losses on bearish investors, with data from Coinglass showing that leveraged short positions in crypto assets were liquidated for a total of about $7.2 billion last week, further accelerating the price gains in a short squeeze. Still, some analysts remain cautious about the recovery, noting that the short squeeze has been a key driver, and that it remains to be seen whether investor buying will continue once short-covering pressure begins to fade.

Global gold prices surged close to $4,700 per ounce today, having risen more than 15% in August from the month's opening price of $4,075, amid investor buying after the U.S. Treasury moved to increase buybacks of long-term government bonds and reportedly considered using funds from the Treasury General Account, or TGA, which has a balance of around $950 billion, to support the bond market and push down long-term yields. MTS Gold noted that the SPDR gold fund bought 2.28 tonnes the previous day, bringing its holdings to 1,049.49 tonnes, with net purchases of 41.62 tonnes in August. Meanwhile, the World Gold Council reported that gold ETF funds increased their gold holdings by 46.7 tonnes, worth $6.4 billion, over the past week, the highest in 10 months, led by funds listed in North America and Europe. Kitco analyzed that technical momentum has strengthened after prices broke through key resistance levels in succession, with the next target at $4,900 and a possible path toward the psychological level of $5,000.

The US Treasury may use the Treasury General Account, whose balance is close to one trillion dollars, to fund the expanded government bond buyback program announced last week, CNBC reported on the 24th, citing two senior Treasury officials. Using the TGA would give the Treasury a powerful tool to influence long-term interest rates. On the 19th, the Treasury surprised markets by announcing it would at least double the size of liquidity-support purchase operations for longer-dated nominal coupon securities, from two billion dollars per operation to at least four billion dollars. However, the Treasury did not specify how the purchases would be funded, and many market participants had assumed they would be financed by issuing short-term Treasury bills. A senior Treasury official did not rule out that possibility. Since the expansion was announced, government bond prices initially rose but then fell back, and yields climbed. One factor behind that was skepticism among many market analysts about the effectiveness of the operations and the Treasury's limited funding capacity. Using the TGA could change that view. The officials declined to say how much of the TGA would be used or when an announcement might come. They did not suggest it would be used for purchases beyond the securities covered by last week's announcement. Meanwhile, asked about the Treasury's plans for future bond buybacks and auction sizes, Treasury Secretary Bessent said the Treasury intends to expand buybacks of government bonds with remaining maturities of ten to thirty years while continuing regular scheduled auctions, including for long-term bonds, as planned. He added that because the expanded operations begin on September 10, no government bonds have yet been purchased under the measure. Bessent did not specify the funding source for the Treasury's bond buybacks, but the TGA held at the Federal Reserve will be one source. Using that account would eliminate the need to issue new short-term government debt to fund the buybacks, but it would draw down the nation's cash reserves. The TGA is essentially the federal government's checking account, used for day-to-day government operating payments such as federal employee salaries, defense contracts, and Treasury interest and principal payments. As of the 19th, its balance was about nine hundred forty billion dollars.

Gold and Bitcoin surged after Treasury Secretary Scott Bessent announced the Treasury would at least double its liquidity-support purchases of longer-dated Treasury securities from $2 billion to $4 billion per operation. Gold climbed almost 7% to roughly $4,730 an ounce, while Bitcoin jumped more than 24% to nearly $80,000 since the announcement. Two senior Treasury officials told CNBC the department is considering using its Treasury General Account, estimated at around $950 billion, to finance expanded buybacks, which could put cash back into the financial system while Treasury purchases longer-dated securities. The 10-year Treasury yield fell to about 4.70% and the 30-year yield slipped toward 5.24%, reducing the opportunity cost of owning gold and supporting demand for scarce, supply-limited assets outside the Treasury system.

The Treasury Department's efforts to calm the bond-market selloff haven't yet worked as well as hoped, with long-term yields remaining near multi-decade highs. Treasury Secretary Scott Bessent outlined plans to buy more long-dated Treasurys this fall and promised to use the agency's large tool kit to support the market, but the 30-year Treasury yield was at 5.24% Monday, still near its 19-year high, and the 10-year yield was at 4.71%, near its one-year high. Portfolio manager Tracy Chen of Brandywine Global said Bessent failed to cap long-term Treasury yields and that bond vigilantes still don't believe him. The Treasury's buybacks can help ease pressure by improving liquidity, but they won't address the core issue of financing a massive and growing debt load, with the nearly $1.8 trillion federal budget deficit so far this fiscal year reinforcing the borrowing need. Net interest payments on the national debt are expected to surpass $1 trillion for the 2026 fiscal year, while higher oil prices and more military spending brought on by the Iran war have fueled renewed inflation anxiety.

US government bond yields fell after reports that the US Treasury may use funds in the Treasury General Account, or TGA, to buy back government bonds. As of 7:36 p.m. Thailand time, the 10-year yield stood at 4.704% and the 30-year yield at 5.235%. CNBC reported, citing a senior Treasury official, that the TGA currently holds about 950 billion dollars in cash, and using funds from this account would give the Treasury the ability to influence long-term bond yields. Last week, the Treasury announced it would increase the size of its long-term bond buybacks from 2 billion dollars to at least 4 billion dollars to boost market liquidity. Treasury Secretary Scott Bessent said the operation could exceed 4 billion dollars. The sources did not specify how much TGA money would be used or when it would be announced, but even a small use of TGA funds, or simply market awareness that the Treasury is ready to use them, could affect bond yields and help ease concerns that the Fed might be asked to step in and help the Treasury buy back government bonds.

Investors face a pivotal 48-hour stretch this week with the release of the Federal Reserve's preferred inflation gauge, Nvidia's fiscal second-quarter earnings, and new Fed Chair Kevin Warsh's first Jackson Hole address. The July core PCE print, due Wednesday morning, is expected to hold at 3.3%, far above the Fed's 2% target, with a downside surprise reducing September hike risk and an upside surprise putting a hike back on the table. Nvidia reports after Wednesday's close with consensus revenue of $91.85 billion and EPS of $2.09, but the stock has declined after recent beats, making October-quarter guidance near $102 billion and gross margin around 73.5% the key metrics. Warsh speaks Friday at 10 a.m. at a symposium where 69% of fund managers expect a neutral tone, yet he leads a divided committee that saw three dissents in favor of a hike at the July meeting and has narrowed forward guidance.

The Federal Reserve's July meeting minutes revealed that many policymakers fear persistently elevated inflation could start to reshape business wage and price-setting behavior. The minutes noted that after 65 consecutive months of headline inflation above the Fed's 2% target, continued high inflation rates could begin to affect inflation expectations. This scenario would be a nightmare for Fed Chair Kevin Warsh, who has maintained a more optimistic stance on price stability. The central bank has left interest rates unchanged over its last two meetings, with three regional presidents dissenting in favor of a quarter-point hike. The minutes also highlighted that AI-driven price impacts have been limited to select categories, with most participants expecting AI to be disinflationary over time.

Silver prices held near $69 per troy ounce on Monday, supported by the US Treasury's pledge to at least double buybacks of longer-dated government debt to curb surging bond yields. Treasury Secretary Scott Bessent said the buybacks could exceed $4 billion, signaling that elevated yields do not reflect economic fundamentals. However, Bessent also announced unprecedentedly tough sanctions on Iran and an oil blockade, which could push energy prices higher and limit future interest-rate cuts, posing headwinds for non-yielding silver. Meanwhile, Deutsche Bank economists previewed Fed Chair Warsh's upcoming Jackson Hole speech, noting he may discuss the Fed's task forces or AI's impact on the economy.

Treasurist unveiled its weekly investment plan for August 24-28, 2026, recommending a half-sized re-entry into global tech equity funds after tech stocks have recovered well since the start of this month. The NASDAQ-100 index is now just 2.0% away from its previous all-time high, while the S&P 500 and Euro STOXX 50 set new all-time highs again midweek before closing the week only slightly lower. US inflation for July 2026 came in exactly as expected across the board, keeping the 10-year US Treasury yield steady in a narrow range of 4.65% to 4.70%, while the 1-year yield fell from 4.04% to 3.97%. Similarly, the US Dollar Index moved in a narrow range of 99.6 to 100, and the Thai baht against the US dollar moved in a narrow range of 33.0 to 33.1. Treasurist continues to recommend keeping risk hedges in place.

TMBThanachart Bank expects the baht to move in a range of 32.20 to 33.00 baht per US dollar this week, from the current level of around 32.74 baht per dollar. The market continues to closely watch economic data and monetary policy direction of major central banks, especially the US Federal Reserve, as well as developments in international trade. The preliminary US composite purchasing managers' index for August rose to 56.0 from 54.5 in the previous month, while import prices fell 0.4 percent and industrial and manufacturing production rose 0.2 percent. Minutes from the Federal Reserve meeting indicated that most officials still supported keeping the policy rate unchanged at the July meeting, but some members saw a possible need for further rate hikes if inflation remained high. The US Treasury announced an increase in the buyback amount for long-term government bonds from 2 billion US dollars to 4 billion US dollars per operation, covering bonds with maturities of 10 to 30 years. Meanwhile, trade tensions between the United States and Canada increased after the US announced a 50 percent tariff on imports from Canada, worth around 20 billion US dollars, and Canada prepared to introduce retaliatory measures of a similar value. Last week, the baht strengthened and traded below 33.00 baht per dollar, supported by a weaker dollar and higher gold prices.

Neel Kashkari, president of the Minneapolis Fed, said the U.S. Treasury market is still functioning well and the recent surge in bond yields is unlikely to affect the Fed's monetary policy considerations. Speaking on CBS's Face the Nation, he said every signal indicates the market has liquidity and is trading normally, which allows the Fed to focus on its policy rate to bring inflation down. The 10-year Treasury yield closed last week around 4.73%, while the 30-year yield was near its highest level since 2007, but Kashkari pointed out that yields were significantly higher during the 1990s. At the Fed's latest meeting on July 28-29, the FOMC held rates at 3.50-3.75% for the fifth consecutive time, with three members including Kashkari voting for a 0.25% rate hike because of concern that inflation has been above the 2% target for more than five years. Investors are watching the Jackson Hole conference on August 27-29 and the speech by new Fed Chair Kevin Warsh on Friday, August 28, to assess plans for tackling inflation amid the surge in bond yields.