Moody’s Analytics predicts 10-year Treasury yields will go from today’s 2.44% to 3.5% in 2014 and to 4.5% by the end of 2015. James Paulson, chief investment strategist at Wells Capital Management, offers a similar forecast, looking for the 10-year bond yields to reach 4% in 2014.
I would not bet money on these guys really being able to predict what is going to happen. Having said that, interest rates of every flavor are closer to their all-time lows than to their all-time highs, so my guess (as good as anyone else's guess) is that rates will head higher in the future- just not sure how long until the
What will happen to $17 Trillion debt & the interest payments that Treasury Dept. would need to come up with ? What about Fed's 4Trilion book ? Keep in mind, fed is holding a very sizable holdings of bonds. Even banks have a substantial position in bonds. How will US govt. adjust cost of living (COLA) tied into Social Security obligations. Generally 10 year rates do not go over the projected GDP.
I think the rates will only rise gradually, much lower than the market is pricing right now. US is the only safe haven asset even now.