2020 outlook for the US 10-year Treasury bond

Wednesday 18 December 2019

Investment Talks

In 2019, the 10-year Treasury yield traded in a range of 1.46-2.78%, the fourth widest range since 2010. The 10-year yield rallied due to uncertainty over  US-China trade negotiations  and ongoing concerns about a weakening global economy. Fueling the rally further was a dramatic   pivot  in the Federal Reserve’s monetary stance from hawkish to dovish, which led to three rate cuts, and finally to neutral. This backdrop was a catalyst behind a strong 10% increase in the US 10-year yield in 2019. Historically, Treasury performance often suffers following a 10% return the preceding year, as the chart shows.

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