TISCO Says Era of Capital Competition Will Keep Interest Rates High Through 2028

โดย Prachachat·USJP·Read original
Summary · why it matters

The TISCO Economic and Strategic Analysis Center, or TISCO ESU, assesses that global financial markets are entering a phase of capital competition, as governments around the world need to borrow heavily to expand defense budgets while private-sector big tech and hyperscaler firms seek to raise enormous sums to accelerate the buildout of data center infrastructure, chip fabrication plants, AI facilities, and power plants. This is pushing interest rates and government bond yields up by roughly 0.60 to 0.90 percent. Komson Prapakpol, head of the TISCO Economic and Strategic Analysis Center, said the United States plans to expand its defense budget from 1 trillion dollars to 1.5 trillion dollars, an increase of 50 percent, while Japan aims to raise defense spending from below 2 percent to 3.5 percent of GDP, the highest level since the period from 1970 to 1980. Germany and France are also accelerating increases in their security budgets. Thanaphat Thanachat, an analyst at TISCO ESU, said the United States has public debt exceeding 100 percent of GDP, or more than 40 trillion dollars, and a fiscal deficit as high as 6 percent of GDP per year, driving its interest burden to double that of four to five years ago. France's public debt has risen by nearly 20 percent of GDP between 2019 and 2025, with an annual deficit of 5 percent of GDP. As for the interest rate path of the three major central banks, TISCO ESU expects the Federal Reserve to raise rates one more time, by about 0.25 percent, at its December meeting, ending at 4.25 percent, and to hold at that level through 2027 before cutting in 2028. The European Central Bank is expected to raise rates one more time, by about 0.25 percent, in December, while the Bank of Japan is expected to gradually keep raising rates until they reach 1.75 percent in mid-2027. The yield on 10-year U.S. government bonds is expected in the base case to hold steady at 5 percent through the end of 2026, but if the Federal Reserve fails to control inflation, the worst case could see the bond yield rise to 6 percent.

Theme Impact 15

Related news

Lockheed Martin Earns Zacks Rank #2 as Earnings Estimates Hold Steady

Lockheed Martin is drawing heavy investor attention, with its shares down 7.5% over the past month while the Zacks S&P 500 composite gained 0.7% and the Zacks Aerospace - Defense industry lost 8.2%. The aerospace and defense company is expected to post earnings of $7.25 per share for the current quarter, a year-over-year change of +4.3%, though the Zacks Consensus Estimate has moved -0.4% over the last 30 days. For the current fiscal year, the consensus earnings estimate of $30.45 indicates a year-over-year change of +31.7%, and for the next fiscal year the consensus estimate of $33.02 points to a change of +8.4%. Consensus sales estimates stand at $20.35 billion for the current quarter, $80.82 billion for the current fiscal year and $84.82 billion for the next fiscal year, representing changes of +9.4%, +7.7% and +5%, respectively. Lockheed reported revenues of $20.06 billion in the last reported quarter, a year-over-year change of +10.5%, with EPS of $7.94 versus $7.29 a year ago, and it is rated Zacks Rank #2 (Buy).
LMT ▲
Defense & Geopolitical Fragmentation
Zacks Investment Research·5hRead more →
impact 4

Iranian leader says US must decide to end war as China pushes to ease tensions

Iranian President Masoud Pezeshkian said that ending the war, now in its seventh month, depends on a decision by the United States. Speaking in an interview with Fox News broadcast on Thursday, September 24, he said America must choose whether to end this, after being asked whether the war could end by the end of this year. Fighting continues, with Houthi forces launching a barrage of missiles and drones at targets in Saudi Arabia on the morning of September 25. Saudi authorities said they intercepted six missiles and issued alerts in Mecca, Jeddah and Yanbu. Saudi Arabia, Turkey and Pakistan are preparing an emergency meeting of military commanders to discuss ways to assist Saudi Arabia under the joint Mecca defense agreement, and Saudi Arabia's Grand Mufti called on forces to be ready to fight the Houthis until the group is removed from power. Pezeshkian said the Houthis must take responsibility for their own actions and that Iran is not in a state of war with Saudi Arabia. The Iran issue was also raised at the US-China summit in Washington, where Chinese President Xi Jinping, during a three-day visit to the United States, discussed a range of issues with President Donald Trump, including trade, artificial intelligence, Taiwan and Iran. Zhai Jun, China's special envoy for the Middle East, said the situation in the Middle East was one of the key issues discussed by the US and Chinese leaders, and said the shared views of both sides are important for defusing the conflict. Trump wants China to help pressure Iran to find a way to end the war, after the United States and Iran returned to indirect talks on the sidelines of the United Nations General Assembly in New York. Iranian officials have signaled that the Strait of Hormuz could reopen within seven days if the United States begins to ease its maritime blockade of Iranian ports.
Defense & Geopolitical Fragmentation ▲
InfoQuest·9hRead more →

19 Democrats Press Trump to Speed Delivery of $15 Billion in Taiwan Aid After Summit With Xi Jinping Yields No Progress

Democratic members of the U.S. Senate criticized the summit between President Donald Trump and President Xi Jinping, saying it prioritized ceremony and optics over real progress on artificial intelligence, trade, strategic minerals, and arms sales to Taiwan. Trump hosted Xi at the White House on Thursday, September 24, amid dignified diplomatic ceremony, but the closed-door discussions showed no sign that the two sides had resolved their disputes. At least 19 Democrats from the Senate's 47-member Democratic caucus signed a statement urging Trump to speed delivery of more than $15 billion in security assistance to Taiwan that Congress has already approved, consisting of $1.3 billion in funding and a $14 billion arms sale package. They also called on the administration to push on human rights issues and the release of Americans who have been wrongfully detained. Some Republican members have likewise urged Trump to quickly release the support funding for Taiwan. Democrats also criticized the Trump administration's easing of restrictions on exports of advanced chips to China, noting that the extension of the tariff truce between the United States and China is not enough to resolve supply chain problems, especially China's dominance of global rare earth smelting and extraction. The Democrats' stance on this summit also reflects the approach party members may take toward China if they can regain a majority in the House of Representatives, the Senate, or both chambers after the midterm elections on November 3.
Critical Materials & Supply Chain ▼Defense & Geopolitical Fragmentation Semiconductors
InfoQuest·12hRead more →
© 2026 MarketDXNews