DoubleLine Says Fed Rate Cuts Will Lead to Steeper Yield Curve

The US yield curve has further to steepen should the Federal Reserve unleash aggressive interest rate cuts, DoubleLine Capital’s Bill Campbell said.

The firm’s global sovereign debt portfolio manager expects easier monetary policy to encourage risk-taking in credit markets, at least in the short term, while doing little to shore up rising long-term yields. Two-year Treasury yields trade near the lowest level since 2022, and 10-year yields at their lowest in five months on the prospect of reduced interest rates.