Citigroup: US Treasury yield curve expected to steepen, driven by short-term debt.

Citigroup interest rate strategists stated in a report that the US Treasury yield curve is expected to steepen, driven by short-term debt. In a "bull market steepening," short-term interest rates fall faster than long-term rates. The strategists stated in the report, "With the increasing risk of rising unemployment due to rising unemployment or a continued rebound in the labor force participation rate, we are inclined to favor a steepening bull market in 2026." Therefore, Citigroup strategists believe the market has already priced in expectations of further rate cuts by the Federal Reserve in the second half of this year, which will keep the "belly" (the middle part of the curve) stable. "Amid a strong economic backdrop, coupled with a dovish Fed and growing concerns about supply, the yield curve should steepen further." (Jinshi)