Morgan suppresses 2019 US yield forecast due to trade tensions By Reuters

NEW YORK (Reuters) – JP Morgan's bond badysts downgraded their outlook for US Treasury yields for 2019 as rising risks to the economy stem from trade tensions that could lead the Federal Reserve to cut back Interest rate twice during the second half of the year.

They revised down their end-of-year targets on Friday night on yields on two-year Treasury bills, which went from 2.25% to 2.25% to 1.40% previously, and 2.45% to 1.75% on 10-year returns.

By the way, JP Morgan economist Michael Feroli said Friday expecting the US central bank to lower its key rates twice later this year: a quarter-point cut in September, followed by a further decline of a quarter point in December.

Earlier this week, investors were already withdrawing money on equities and other risky badets, fearing a protracted trade war between China and the United States.

Thursday, the surprise announcement of US President Donald Trump to impose tariffs in Mexico on June 10 disrupted financial markets, pushing investors to rush into the yen, the Swiss government and the US government .

US two-year and 10-year yields fell to 1.916% and 2.126% on Friday, their lowest levels since September 2017.

Trump's move is to compel the Mexican government to prevent immigrants from illegally entering the United States on its southern border. Analysts warned that the 5% tariffs on Mexican tariffs, if they took effect, would increase costs for US businesses and consumers, which would dampen the economy.

"In this context, we are also revising our lower interest rate forecasts and we are no longer looking to boost returns until the end of the year. to fall further in the coming months, "commented JP Morgan badysts. a research published late Friday.