Infrastructure Capital Advisors said it is constructive on U.S. 10-year Treasurys, arguing that the Federal Reserve is likely to deliver only one more rate hike. According to the firm, that view is consistent with the Fed’s dot plot, which reflects policymakers’ rate expectations, and is still below what markets are currently pricing in. In a report, the firm’s chief executive officer and portfolio manager said the yield on the U.S. 10-year Treasury typically stands about 100 basis points above the terminal federal funds rate. On that basis, the firm expects the 10-year yield to stabilize around 5% if weak housing data and soft core CPI readings lead the Fed to pause further tightening. The comments were reported by BlockBeats on Oct. 8.
BlockBeats reported on Oct. 8 that Infrastructure Capital Advisors is positive on U.S. 10-year Treasurys because it expects the Federal Reserve to raise rates only one more time.
In a report, the firm’s chief executive officer and portfolio manager said one additional hike would align with the Fed’s dot plot, or policymakers’ projections for interest rates, and would be less than what the market is currently pricing in.
He said, 「The yield on the U.S. 10-year Treasury is usually 100 basis points above the terminal federal funds rate. As a result, we expect the U.S. 10-year Treasury yield to stabilize at around 5% as weak housing data and soft core CPI data push the Fed to pause rate hikes.」
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