The bulk of published research this week points to higher US Treasury yields, meaning lower bond prices, especially at the long end.
The reasoning most analysts converge on: sticky inflation, a federal deficit near 6% of GDP, heavier issuance, and price-sensitive buyers stepping in where foreign reserve managers used to. One widely cited note argues the 30-year yield just hit its highest level since 2007 and that Treasury buybacks are only a Band-Aid. Others flag energy pressure from the Iran conflict and AI-driven growth as adding fuel. A notable shift: much of the research now expects the Fed to hike rather than cut near term, pushing short-end yields up too. One forecast sees the 30-year reaching 5.00–5.25% by Q2 2027.
Credit views split. Several researchers warn about widening spreads on AI-linked names and weaker high-yield borrowers, while others stay constructive on higher-quality credit, AAA CLOs, and TIPS.
A contrarian thread argues yields could fall if AI weakness spreads or growth data softens — framed as a scenario, not the base case.