Published research this week leans bearish on US Treasuries, with the long end under the most pressure and curve steepening a recurring theme.
The hawkish case, argued across several recent research notes: incoming Fed leadership is expected to shrink the balance sheet and overhaul communication, adding rate volatility and capping declines in long yields. One camp of analysts flags term premium well below its long-run average and projects the 10-year normalizing toward 5.25–5.9%. Others point to a resilient labor market and sticky inflation as removing any near-term catalyst for lower rates, with some published forecasts calling for another 75bps of Fed hikes by year-end and describing the long end as "rich."
A contrarian thread sees it differently. Softer recent payrolls have already pulled front-end yields lower in some analysts' framing, and a strategic view holds that AI-driven productivity gains will prove disinflationary over time — with one published projection showing Fed Funds falling from 3.75% in mid-2026 to 3.25% by end-2027.
On investment grade credit, the research consensus is cautious: spreads seen widening, and nearly $1 trillion of AI-related issuance expected to weigh on prices.