Saxo Markets indicated that if risk sentiment continues to weaken and growth risks emerge during the U.S. earnings season, benchmark U.S. Treasuries could see a technical rebound, with yields potentially falling to 5%. Charu Chanana, Chief Investment Strategist in Singapore, noted that U.S. Treasuries rose in Asian markets on Tuesday, a typical safe-haven move as equity markets came under pressure and investors sought safe-haven assets. "But I can also smell a hint of growth concerns; rising diesel costs may pose risks to households and businesses."

Further gains would be tactical, as inflation risks are already fully priced in, and the 10-year Treasury yield at "5% may be the first reasonable level worth watching." "If risk sentiment continues to weaken and growth concerns intensify, we may reach this target soon," she said. Traders are "clearly closely monitoring" potential growth risks during the corporate earnings season. The market is paying close attention to "any signs of downward guidance revisions, margin pressures from energy and transportation costs, and any indications that companies—at least those beyond the well-capitalized ones—are becoming more cautious with capital expenditures."

However, the Treasury rally may not last, as "a more sustained rise requires easing inflation concerns, otherwise it faces a severe growth shock," while fiscal risks and heavy bond issuance remain. "I don't currently see this as a structural shift." The 10-year U.S. Treasury yield briefly fell 5 basis points to 5.19%.