repo funding rates don't affect US treasury yields immediately due to time scale

treasury bond yield expectation is over 10 years, and repo rates are a short-term debt funding mechanism

so the rates shock would need to be prolonged/pronounced to affect treasury rates

Illya Gerasymchuk 2025-07-07 18:17

funding rates on repo markets & bond yields are not the same

different timescales:
1️⃣ repo - short-term / ≈day(s),week(s)
2️⃣ treasury bonds - ≈10 years

so even if a funding rate raises for a few days, the longer-term bond yields may not be affected