TS Lombard said that the US Treasury's move to buy back ultra-long-term treasury bonds “sounds a lot like” yield curve control, and that artificially depressing yields would weaken the dollar. Chief economist Freya Beamish wrote in a report: “The US is implementing a procyclical fiscal policy and should have raised interest rates, which will benefit the dollar. Long-term bond investors want compensation, and the Ministry of Finance is intervening to lower yields and further reduce the short term when the average term of debt is already short.” “It sounds a lot like YCC,” she added, adding that shortening the debt period while implementing procyclical fiscal policies and raising interest rates “is a recipe for weakening the dollar.” “If the average term of your debt is already short, and more bonds will be issued in the short term, and interest rates are still rising, this is bad for the financial situation — the market will win this battle.” “The only question is how the market will win: continue to put pressure on long-term yields, so that the Fed can act as the responsible person to raise interest rates earlier than the market currently expects; or the dollar is sold off. “The Federal Reserve will eventually raise interest rates,” said Beamish, who is based in London, and the situation in which the Federal Reserve is in stark contrast to that of the United Kingdom. The average term of UK debt is much longer, reaching 14 years. The government has been promoting fiscal consolidation, and interest rates should be lowered “Here, shortening the term is reasonable, and it will not expose the government to excessive interest rate risks.”

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