Will 10yr yields reach 5%?
In a media conference after JP Morgan released earnings, Jamie Dimon said he is still standing by the claim he made in August about rates
I have much higher odds of it being 4% than other people
Two months ago, he claimed that 10yr notes should be at 4% and to be prepared to deal with 5%+ yields.
Thoughts on his predictions?
Not a fucking chance. We’ll be trading in the 3-3.50 range for the next year or two. The core is STILL anticipated to be 2.2% YoY. There’s just no reason for the curve to steepen that much, without serious anticipation of higher inflation or material changes in US credit quality. IMO Fed policy is going to flatten the curve, and end the current cycle.
Yeah, it's pretty farfetched imo. But when this kind of prediction comes out of Dimon's mouth, it makes you wonder: "what if?"
I'd rather have people prepare for the potential for that to happen (and thus, stress test it) rather than see them get blindsided by it.
I don't see why not? Historically it's been much higher.
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