Lates News

Nuveen investment strategist Laura Cooper pointed out in her report that due to high debt levels and expectations of potential interest rate hikes, the downside potential for 10-year Treasury yields is limited. She said, "Unless there is a significant growth shock, fiscal pressure, rising debt levels, and the gap between market expectations for interest rates and actual policy direction will make it difficult for 10-year Treasury yields to fall below 4% by the end of the year." However, potential obstacles to economic growth and softening job data will also prevent yields from rising further. Although bond investors are "buying on dips" (i.e. building positions when yields rise and bond prices fall), Cooper warned that the risks of long-term bonds still exist.