Core Insights - The report from CITIC Securities analyzes the recent volatility in the U.S. Treasury market, attributing it to factors such as weak auction demand, rising interest rates, and investor sell-offs, exacerbated by high leverage strategies in the U.S. financial market [1][3] Group 1: U.S. Treasury Market Analysis - The fundamental cause of the volatility in the U.S. Treasury market is the accumulation of long-term risks in the U.S. economy, including significant fiscal expansion post-pandemic and high policy interest rates [3] - The proportion of stable funds in the U.S. Treasury market has decreased, amplifying market volatility risks and increasing selling pressure due to a declining recognition of U.S. Treasuries as a safe-haven asset [3] - The liquidity in the U.S. Treasury market has sharply declined since early April, although there has been some recent easing, indicating ongoing risks [3] Group 2: Global Market Implications - The volatility in U.S. Treasury yields is expected to increase pricing pressure in global sovereign debt markets and accelerate the diversification of reserve assets among countries [3] - The fluctuations in U.S. Treasury yields may lead to a re-pricing in global sovereign debt markets, higher corporate borrowing costs, and heightened panic in global financial markets [3] Group 3: Impact on China - Short-term increases in U.S. Treasury yields may negatively affect the Chinese stock market, but there could be a turnaround in the medium to long term [4] - The short-term impact of U.S. Treasury yield volatility on the Chinese bond market is limited, with expectations of stable performance in the medium to long term [4] - The weakening of U.S. dollar credit and limited domestic capital outflow pressure may support the renminbi exchange rate, with long-term benefits for the internationalization of the renminbi [4]