US credit rating downgrade triggers ripple effect on economic outlook Bank of Singapore warns of three key impacts

金融界2025-05-19

In his latest research note, Mansour Muhiuddin, chief economist at the Bank of Singapore, pointed out that Friday's credit rating downgrade in the United States had a broad impact on its economic outlook. The economist emphasizes three core points:

First, "the deteriorating fiscal situation in the United States has strengthened our judgment that the long-term yield of U.S. bonds will gradually rise". The bank maintained its forecast that the 10-year U.S. Treasury yield would hit 5.00% in the next 12 months.

Second, the challenge faced by the status of safe-haven assets in the US Treasury Bond highlights the bank's core judgment that "the US dollar exchange rate has peaked".

Third, economists add, huge fiscal deficits and inflationary pressures may force the Fed to maintain high interest rates for a long time. Current data shows that the yield on the 10-year U.S. Treasury rose 7 basis points to 4.5107%.

Editor-in-charge: Shan Shang

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