Treasuries buckled again this week, and published research is nearly unanimous that the pain isn't over.
The dominant view across analysts: the 10-year has pushed above 5% on a mix of sticky inflation, heavy Treasury supply, resilient growth, and fiscal deficits running near 7.5% of GDP. Several notes flagged competition for capital from AI capex and infrastructure spending as a structural driver of higher real yields, not a passing shock. Long-end targets in the published work ranged from 6% by year-end to 5.5–6% over the next 12–24 months, with one thread arguing 30-year yields near 6% may be needed to tighten conditions enough to cap inflation. Front-end pricing now embeds roughly four additional hikes into 2027–28.
Not everyone is one-way. A tactical strand highlighted that 10Y futures are at decade-extreme oversold levels, arguing for a counter-trend rally toward 4.40–4.60 before the broader uptrend resumes. On credit, researchers flagged rising stress in CCC names from 2021–22 vintages, while others pointed to floating-rate loan funds and discounted closed-end credit vehicles as relative havens.