The US bond market is warning President Donald Trump that his proposed tariffs could fuel inflation and slow economic growth. Short-term interest rates rose by 8 basis points to 4.28% due to concerns over rising consumer prices. However, longer-term interest rates fell, narrowing the gap between 2- and 30-year bonds, as investors worry about a potential economic slowdown. The warning is a sign that markets are preparing for the impact of tariffs on inflation and growth.
Source: https://www.bloomberg.com/news/articles/2025-02-03/treasuries-fall-on-short-end-as-tariffs-deepen-inflation-fears