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Quicktake: 2% 10Y Yield By Year End?

US TSYS
Societe Generale strategists anticipate 10Y yield will reach 2.0% by year end (1.592% currently after topping 1.6238% last Friday) citing "Fiscal support, improving fundamentals, easy financial conditions and an accommodative Fed support."
  • While higher yields and steeper curves should prevail, the pace of the sell-off is likely to moderate in 2H.
  • Although the Fed reaction to higher yields has been muted thus far, policy response to a continued sell-off remains a key risk to our call for higher yields. The Fed will likely tolerate higher yields if fundamentals continue to improve and financial conditions remain accommodative.

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