ING: The Game between US Treasuries and the US Dollar against the Backdrop of Inflation

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智通财经2026/10/16 12:36

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ING noted that Coreweave-related asset sell-offs saw a slight reversal yesterday, after NVIDIA CEO Jensen Huang stated that Coreweave's financial strength is improving and its capital cost is decreasing.
Considering NVIDIA is a major shareholder in Coreweave, such comments are not surprising. How long this rebound will last remains to be seen.
An important change this week is the recovery in the long end of the U.S. Treasury market, even as inflation data remains persistently high.
The institution believes investors seem to be starting to regard long-end U.S. Treasuries as valuable, and view them as a moderate hedge against an AI trade pullback.
If technology stock selling intensifies, Treasury demand may shift toward the short end of the curve.
Although concerns about an AI pullback are rising, inflation data remains strong. The U.S. September Producer Price Index released yesterday far exceeded expectations.
Today's year-on-year increase in import prices is expected to be close to 8%, the highest level since the summer of 2022.
Inflation data supports short-term rates; this week, the 2-year and 10-year U.S. Treasury yield curve flattened by nearly 20 basis points.
For the FX market, a scenario where the Federal Reserve steps on the brakes while growth prospects are revised down is usually supportive for the dollar against cyclical and emerging market currencies.
The institution believes only when short-term rates clearly move lower will the dollar have conditions to weaken, which has not happened yet.
Unless AI stocks and overall risk assets drop sharply again, the dollar is expected to consolidate near recent highs.
ING expects that in this environment, the Swiss franc may continue to show defensive advantages, while resistance for the Dollar Index is around 102.40 to 102.50, and support is near 101.75 to 101.80.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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ING: The Game between US Treasuries and the US Dollar against the Backdrop of Inflation

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