US 10-year Treasury yield reportedly could hit 6%, Pimco's Ivascyn says
TLT•Pimco CIO Dan Ivascyn said the 10-year US Treasury yield could reach 6% for the first time since 2000, citing high oil prices, inflation concerns and growing public debt. The yield was at 5.29% after reaching 5.34% last week.
1. Yield could reach 6%
The benchmark 10-year US Treasury yield could rise to 6% for the first time since 2000, Pimco Chief Investment Officer Dan Ivascyn said in an interview with the Financial Times. He said a further rise from 5.29% was feasible in the near term, citing hedge funds unwinding losing bond positions and other leveraged investors facing stop-outs.
2. Risk assets could weaken
Ivascyn said a move to 5.5% or higher would likely cause “some decent weakness in risk markets, both credit and equity.” The 10-year yield has risen almost 120 basis points this year and reached 5.34% last week, its highest level since 2002.
3. Bond selling pressure
Global bonds have faced heavy selling this year as energy costs fuel inflation and the AI boom lifts economic growth. The US 10-year Treasury yield had its biggest quarterly rise this century in the three months ending in September.
