According to BlockBeats, on August 3, data from the Institute for Supply Management (ISM) showed that the U.S. manufacturing PMI rose to 55.6 in July, a new high since May 2022, marking the seventh consecutive month in expansion territory.

Data shows that the U.S. manufacturing production index rose to 58.5 in July, the highest level since the end of 2021. New orders continued to grow strongly, and manufacturing employment also rebounded for the first time since September last year, indicating that businesses are more confident in the future economic outlook.

However, behind the manufacturing recovery, inflationary pressures and bond market risks continue to rise. The ongoing conflict in the Middle East has repeatedly pushed up oil prices, putting pressure on supply chains and raw material costs. Although the manufacturing price index fell to 71.1 in July, a five-month low, it remains at a relatively high level.

Strong economic data coupled with inflation concerns have led to recent volatility in the US Treasury market. Mark Cabana, head of US interest rate strategy at Bank of America, said the current bond market volatility is a "textbook example of an inflation credibility shock," reflecting market concerns about insufficient policy communication from the Federal Reserve.

Cabana points out that Federal Reserve Chairman Kevin Warsh failed to clearly articulate the specific path to achieving the 2% inflation target, and the end of the long-used "forward guidance" strategy has also plunged the market into uncertainty.

Data shows that the term premium for 30-year US Treasury bonds has risen to 1.51%, the highest level since 2013, and the yield on 30-year US Treasury bonds once rose to 5.28% last Friday. Bank of America believes that the Federal Reserve needs to rebuild market confidence through its September interest rate decision; otherwise, pressure on the US Treasury market may further increase.