An analysis of the behaviour of the yield of 10-year US Treasuries during the eight major Fed tightening cycles since the 1970s suggests to us that the current sell-off in long-dated US government bonds may have further to run if the Fed hikes rates by a further 300bp over the coming year, as we expect. This underpins our forecast for the 10-year Treasury yield to rise to a peak of 3.75% by the middle of 2023.
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