The recent period of 10-year interest rates in the 5% range is unlikely to last for long.
Morgan Stanley forecasts that the Federal Reserve will raise interest rates by 25 basis points in both December of this year and March of next year, after which it will maintain the benchmark rate at 4.25-4.50%.
The market is reflecting the possibility of one further rate hike by 2027. Therefore, if these expectations decrease, bond yields could fall.
In particular, it is expected that the 2-year interest rate will fall more sharply than the 10-year interest rate in the second half of 2027, causing the yield curve to steepen again.
The key factors to watch are oil prices and the economy.
Currently, the bond market appears to be overreacting to the possibility of further tightening by the Federal Reserve, and it is believed that the probability of a decline in Treasury yields in 2027 is greater than the probability of an increase.
#FederalReserve $NMR $ALGO $MUBARAK
Morgan Stanley forecasts that the Federal Reserve will raise interest rates by 25 basis points in both December of this year and March of next year, after which it will maintain the benchmark rate at 4.25-4.50%.
The market is reflecting the possibility of one further rate hike by 2027. Therefore, if these expectations decrease, bond yields could fall.
In particular, it is expected that the 2-year interest rate will fall more sharply than the 10-year interest rate in the second half of 2027, causing the yield curve to steepen again.
The key factors to watch are oil prices and the economy.
Currently, the bond market appears to be overreacting to the possibility of further tightening by the Federal Reserve, and it is believed that the probability of a decline in Treasury yields in 2027 is greater than the probability of an increase.
#FederalReserve $NMR $ALGO $MUBARAK
