The real driver behind rising Treasury yields is coming into view, prepare for what might come next. The move higher in yields reflects stronger nominal growth, sustained by a 6% of GDP deficit and heavy AI-related capex. Not a failed attempt at yield-curve control. To put this into perspective: the emerging policy mix keeps the front-end policy rate STEADY while delivering liquidity through expanded bill financing, reserve management, and private absorption of short-dated paper. Here's how you know it's working: Stable repo conditions. Contained bond volatility. A steeper curve. This is key: rising yields are a near-term headwind, but the broader backdrop, fiscal stimulus financed at the short end plus a shift toward real-economy spending, still favors liquidity-sensitive assets and real assets.