Analyst: U.S. tax cuts are expected to put pressure on the long end of U.S. Treasuries

ChainCatcher news, Arif Hussain, head of the fixed income department at T. Rowe Price, pointed out that the passage of Trump's "beautiful plan" is expected to lead to an increase in the U.S. structural deficit, thereby putting pressure on the long end of the Treasury yield curve.

He stated, "The tax cuts will keep the U.S. fiscal deficit high for the foreseeable future and put pressure on the long end of the U.S. Treasury yield curve." A qualitative consideration that could worsen the situation is that if the U.S. no longer plays the role of "global police," the future expected foreign demand for U.S. Treasury issuances may come into question. In this context, T. Rowe Price indicated that U.S. Treasuries with a maturity of 10 years and longer may face significant pressure.