The recent rout in 10-year US Treasury notes has pushed yields to their highest since 2007, with a recent bump taking them above 4.89%. How much further will this sell-off go and how long will it last? I can venture educated guesses based on history. Looking at past periods of monetary policy tightening, my main observation is that the 10-year yield tends to max out at-or slightly above-the Federal Reserve's peak policy rate. Investors traditionally demand a premium for the inherent uncertainty associated with holding longer-term bonds.
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