Fed's Hawkish Shift: 2-Year Yields Eye 5% Return

The likelihood of US 2-year yields moving back towards 5% is increasing, as the Federal Reserve's March dot plot may suggest only two 25bps interest rate cuts this year instead of three. This shift comes after US CPI data revealed a slowdown in inflation, indicating that rates may need to remain higher for longer.
The split within the Fed between those projecting two rate reductions and those indicating three is close, with potential for a more hawkish stance if members in the three-cuts camp switch to two cuts. The recent elevated US CPI figures provide support for any Fed member considering a more hawkish position. $S&P 500 Index (.SPX.US)$ $Nasdaq Composite Index (.IXIC.US)$ $S&P 500 Index (.SPX.US)$