Investors are growing increasingly concerned about a U.S. asset exodus, with Treasury yields and the dollar reaching new lows. The benchmark 10-year Treasury yield briefly surpassed 4.5%, while the ICE U.S. Dollar Index hit its lowest level in three years.
Experts say the rapid moves in financial markets suggest that investors are actively turning away from the U.S., driven by concerns over structural attractiveness of the dollar and ongoing trade tensions. The April sell-off for financial markets has been wider and more volatile than typical pullbacks, fueling fears about long-term damage to the financial standing of the U.S.
These moves have real economic impacts, including potential issues with companies having significant foreign sales businesses caught in the crossfire of global trade disputes. Rising Treasury yields also cloud the outlook for U.S. government spending and economic growth, exacerbating worries about the federal deficit.
The possibility of another flare up in inflation looms over these market moves, with recent readings showing Americans are worried about a spike in inflation tied to the tariffs. This limits the options for the Federal Reserve, which will be reluctant to cut interest rates when consumer prices are rising.
Source: https://www.cnbc.com/2025/04/12/investors-are-growing-concerned-about-a-us-asset-exodus-as-treasuries-and-the-dollar-decline.html