Will US Treasury Rally in 2024? A Look at Differing Predictions

In One Chart wrote a column · Dec 13, 2023 17:59

According to Praveen Korapaty, Goldman Sachs's chief interest-rate strategist, and Joseph Brusuelas, the top economist at tax consulting firm RSM, the 10-year Treasury yield is expected to increase to approximately 4.5% by the end of next year, indicating a potential upward trend for the "global asset pricing anchor" instead of the previously predicted decline due to optimistic interest rate cut expectations.。

However, a Reuters poll of 50 bond strategists, mostly from sell-side firms, said that the 10-year yield will then fall to 4.10% by end-May, before hitting 3.88% in 12 months.

At the beginning of November, markets were pricing about 70 bps worth of rate cuts for next year and now it's 120. Much of the declines we saw recently were based on the front-loading of these expectations," said Zhiwei Ren, portfolio manager at Penn Mutual Asset Management.

Bond giant Pacific Investment Management Co. is renewing the call for 2024 as well. Pimco managers predict that 2024 will be an excellent time for the bond asset class.