Deutsche Bank raises 10-year US Treasury yield expectation, believing that the Federal Reserve has already completed rate cuts.

Deutsche Bank's interest rate strategist has raised the expected yield on the 10-year US Treasury bonds by the end of this year, citing expectations that the Federal Reserve officials, led by Chairman Kevin Warsh, have finished cutting interest rates. The strategy team at Deutsche Bank, including Matthew Raskin and Steven Zeng, predicts that the 10-year US Treasury bond yield will peak at 4.70% by December, higher than the level of about 4.45% on Friday, which was also the bank's previous year-end forecast. The strategists wrote in a report on Friday, "This change reflects our revised baseline view that the Fed has finished cutting rates and will keep rates unchanged at the long-term neutral rate during the forecast period." This change is in line with the ongoing hawkish reassessment of the Fed's policy path in the coming months, as the conflict in Iran has boosted energy prices and disrupted inflation prospects. Since the conflict began in February, the 10-year US Treasury bond yield has risen by about 50 basis points.