Anchor Capital says Fed policy outlook, not fiscal fears, drives US Treasury yield cycle
TLT•Anchor expects lower yields and a softer dollar
Anchor expects a weakening inflation impulse, sees the Fed falling short of priced tightening, forecasts lower Treasury yields and a softer US dollar.
Fed outlook seen as main driver of Treasury yields
Anchor Capital flagged monetary policy as the main driver of US Treasury yields, citing repriced Fed expectations over fiscal-risk concerns.
It said 2026’s 10-year yield moves tracked the market-implied long-run SOFR as markets swung from two cuts to nearly two hikes by end-August.
Selloff described as global rather than US-specific
The firm argued the selloff looks global, not US-specific, citing Treasuries outperforming several G7 peers while US CDS stayed range-bound.
It attributed higher yields to a rising term premium as quantitative tightening unwinds QE-era distortions, with the US 10-year term premium near 0.8%.
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