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Brainard Appears Happy With 10Y Real Yields

FED
  • From the prepared remarks, Brainard appears happy with 10Y real yields at current levels, which after yesterday's further surge are close to highs since early 2019: "So far during 2022, real 2-year yields have risen more than 350 basis points to about 1.2 percent, and 10-year real yields have risen almost 200 basis points and now stand at 0.85 percent—in the range of values for 10-year real yields from 2014 to 2018." - chart below
  • At the shorter end: "The rapid tightening in monetary policy is also reflected in a significant increase in the projected real short rate: The Blue Chip Financial Forecasts has the expected short rate moving above 0.5 percent in real terms to a significantly higher level than pre-pandemic within the next 12 months"

2Y and 10Y real Tsy yieldsSource: Bloomberg

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