Financial Market Players Weigh in on the Possibility of 10-Year Treasury Yield Reaching 5%

Barclays analysts believe that yields on the benchmark 10-year Treasury note will not cool off without a substantial stock market selloff. Despite recent buying interest in U.S. government debt, there is no magic level of yields that will automatically attract enough buyers to spark a sustained bond rally. Barclays argues that stocks still have room to reprice lower before bonds stabilize. The $25 trillion U.S. Treasury market has been caught between the need for higher borrowing costs and investors' interest in attractive yields. The recent selloff in longer-term maturities has been described as breathtaking, and Barclays sees no clear catalyst to stem the bleeding.