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⑴ On Wednesday, the yield on India's 364-day Treasury bills rose to 6.03%, surpassing the 6% mark for the first time in nearly 14 months and marking the sixth consecutive week of gains for this instrument. A trader at a small financial bank stated that concerns over potential rate hikes are intensifying, and investors are hesitant to take directional bets on the one-year tenor, which is the main factor driving continued upward movement in short-term rates. ⑵ This shift in the yield curve has caused the yield spread between the 364-day Treasury bills and the 10-year government bonds to narrow sharply, compressing from 140 basis points two weeks ago to 95 basis points, the lowest level in four months. ⑶ The current one-year overnight indexed swap rate stands at 6.10%, indicating that expectations for higher short-term rates are still building in the market. The Reserve Bank of India will announce its latest rate decision on June 5, and the market will be closely watching to see whether the central bank takes action to address inflationary pressures. The sustained rise in short-term rates also adds more uncertainty to next week's policy meeting.

⑴ Yields on US Treasury bonds of all maturities fell across the board on Tuesday, with the US Dollar Index dropping 0.1% to 99.09. DHF Capital S.A CEO Bas Kooijman stated that investors remain optimistic that diplomatic breakthroughs in the Middle East could eventually lead to the reopening of the Strait of Hormuz and ease inflationary pressures related to energy prices, which drove yields to extend the previous trading day's decline.⑵ Data showed the 10-year US Treasury yield fell by 2.8 basis points to 4.463%. The market remains cautiously weighing the prospects for a peace agreement, with no signs of excessive optimism or buying momentum.⑶ Currently, the market's focus has shifted to Thursday's release of the Personal Consumption Expenditures Price Index and Gross Domestic Product data. Kooijman pointed out that these two data releases could serve as important catalysts for movements in the dollar and US Treasury yields; if inflation readings exceed expectations or if there are changes in economic growth data, it could reverse the current trend of falling yields.

Foresight News reported that trader Chris Beamish, citing glassnode data, said that Bitcoin's native volatility is being compressed again. DVOL has fallen back to around 35, approaching its lowest level in the past year.