Since Treasury bonds** are negatively correlated with interest rates, the yield on 10-year Treasury bonds in particular can be used as an important indicator for judging future interest rates.
The circled areas in the chart are the highs set in March 2020 at the time of the outbreak of the domestic epidemic, and then fluctuate with the epidemic and domestic economic conditions.
It has continued to rise this year, and is close to the high point of three years ago, and is expected to break through in the near future based on the current trend.
This also means that interest rates will fall further in the future, and to what extent I have been more aggressive than Japan's ** before.
The reason why Japan is compared is that the two are very similar.
The domestic economic development has encountered bottlenecks, population growth has reached an inflection point, and the industrial structure is facing upgrading; Externally, the United States has continuously suppressed all industries that may pose a threat to the United States through technological means.
In the financial markets, Japan** experienced a 20-year bear market, which did not begin to reverse until it began to implement aggressive monetary easing, and began a bull market that has been around for more than 10 years, and is now close to an all-time high.
Japan implemented the ** New Deal in 12 years, and the benchmark interest rate was reduced to -0 in 16 years1%, while back in 1999 the Japanese interest rate was lowered to 0.
At present, the lowest interest rate in China is as high as 3.3 years LPR45%, there is still a lot of room for decline, and once the 10-year treasury bonds break through the epidemic high, it means that China's monetary policy will undergo historic changes.
Ultra-low interest rates are conducive to reducing the cost of production and living, which has a positive effect on the economy in stagflation, and also has a positive impact on the economy.