TAG Industrial Watch: March 29, 2025
While it’s easy to get caught up in daily headlines about Trump’s new tariffs that may or may not be implemented, industrial investors should not be distracted from the eye of the storm that has recently settled over the bond market. Over the last month, the yield on the 10-year Treasury has hung around the 4.3% range, allowing mortgage rates on industrial loans to hover around 6.7%. The recent stability in the bond market is partly due to the national debt ceiling that was reinstituted at the start of the year at $36.1 trillion. With the national debt sitting $100 billion higher than the legal limit at that time, the U.S. Treasury Department has been handcuffed from borrowing more, resorting to “extraordinary measures” to keep the government afloat until Congress passes a new budget (ABC News).
In other words, the Treasury has dipped into its rainy-day savings that it keeps in its bank account at the Federal Reserve. Since mid-February, the Treasury’s bank account has dropped from $828 billion to $436 billion (FRED). However, with April around the corner, the Treasury will likely get its typical surge in income tax revenues (last April’s budget surplus totaled $209 billion), buying the government a little more time. Nonetheless, it won’t take many more months before the Treasury’s rainy-day savings dwindles to $0 and Congress is forced to pass another spending bill so that America prevents a default on its debt (just like in 2023). When this happens, the Treasury will be back to its usual borrowing ways, resuming the upward pressure on interest rates. Until then, industrial investors should take the opportunity to secure mortgages rather than continue to sit on the sidelines, hoping for lower rates.
I N D U S T R I A L N E W S
Here Comes Another Federal Default Scare
GlobeSt.com – March 26, 2025
Read More
US Could Run Short Of Money To Pay Its Bills
By August Without A Debt Limit Deal: CBO
ABC News – March 26, 2025
Read More
Industrial Report: Manufacturing
Surge Drives Industrial Expansion
Commercial Property Executive – March 5, 2025
Read More
Trump Auto Tariffs: President Slaps
25% Duties On Car Imports To US
Reuters – March 27, 2025
Read More
Trump Says No Exemptions On Steel,
Aluminum Tariffs; More Are Coming: Updates
USA Today – March 17, 2025
Read More
R E G I O N A L N E W S
Hydrogen-Powered Data Center Planned For Laredo
Connect CRE – March 24, 2025
Read More
Venture One Real Estate Acquires 218,617-
Square-Foot Industrial Building In Waukegan
REjournals – March 25, 2025
Read More
Developers Pull Back As Denver’s
Industrial Vacancy Peaks
Bisnow – March 17, 2025
Read More
Top 10 Emerging Industrial Markets
Commercial Property Executive – March 6, 2025
Read More
Trade Uncertainty Looms Over
Texas Border’s Industrial Growth
GlobeSt.com – March 25, 2025
Read More