Vanguard Warns 10-Year Treasury Yields Risk Jump Back to 5%
- Move past 4.75% may set disorderly selloff in motion
- Traders are pushing back bets on start of Fed easing cycle
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The Treasury market is nearing levels that risk triggering a large selloff, pushing yields on 10-year bonds back to 5%, according to Vanguard.
“We are in a danger zone right now,” Ales Koutny, head of international rates at Vanguard, said in an interview. Even a small move higher — past the critical 4.75% level — could force investors to abandon their bets on a rally, giving way to a wave of selling that could push yields toward the highs of 2007, he said.