Citi Says Keeping US 30-Year Yield Below 5.30% May Add Pressure on Dollar
JH Kim
Summary
- Citi said keeping the 30-year US Treasury yield below 5.30% could increase pressure for dollar weakness.
- Citi said it unwound its underweight position in US Treasuries after US Treasury Secretary Scott Bessent's bond buyback announcement.
- Citi also said it bought gold while maintaining its short dollar position.
Forecast Trend Report by Period
Citi said the dollar could come under greater downward pressure if the yield on the 30-year US Treasury is kept below 5.30%.
Walter Bloomberg reported on August 28 that Citi strategist Dirk Willer said limiting the 30-year Treasury yield so it does not rise above 5.30% could intensify pressure for dollar weakness.
Citi unwound its underweight position in US Treasuries after US Treasury Secretary Scott Bessent announced a bond buyback program. It also maintained a long gold position and a short dollar position.
Willer added that asset-swap spreads, which typically show concerns about US fiscal soundness, have so far remained relatively stable.
JH Kim
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