US 10-year bond yields are expected to move only marginally higher as the US Fed continues to increase its policy rate.We expect a continuation of the Fed’s“slow and cautious”policy,and,on average,50bps per year until the upper end of the Fed Funds range reaches our forecasted terminal level of 2% in mid-2019.We forecast a fair-value cycle high UST 10-year bond yield of 2.7%.These are unchanged forecasts.Please see pages 2-6.
20161221-MACQUARIE-THE_GLOBAL_MACRO_OUTLOOK:THE_OUTLOOK_FOR_US_BOND_YIELDS-690223.pdf
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