Published research this week points to sustained upward pressure on US Treasury yields across the curve, with the 10-year drawing the most attention. The consensus in recently released analysis sees yields drifting toward — and potentially through — 5%, with only a small contrarian thread expecting moderation as inflation cools and labor markets soften.
Analysts point to Fed Chair Warsh's hawkish Jackson Hole speech as the immediate catalyst, pushing 2-year yields 7–10 basis points higher and shifting pricing toward a near-term hike. Beyond that, a broad body of research cites structural drivers: heavy Treasury supply, large fiscal deficits, elevated term premia, AI-related corporate issuance competing with Treasuries, and a smaller Fed balance sheet. One camp argues the Fed still has real work to do on inflation. Another view frames rising long-term rates as an unavoidable adjustment tied to roughly $40 trillion in US debt, with Treasury buybacks too small to cap the move.
On credit, some published views flag near-term pressure on investment-grade yields from heavy AI-linked issuance, while a contrarian thread highlights longer-dated municipal bonds as offering standout risk-adjusted value.