Rising Bond Yields: Implications and Investor Strategies

Bond yields could reach 6% as the Federal Reserve continues to raise interest rates, according to research firm TS Lombard. The firm cites a strong labor market and robust economic data as factors that could lead to higher inflation and subsequent rate hikes. The 10-year US Treasury yield recently reached a 16-year high, and TS Lombard predicts that rates could rise even further. However, higher rates also carry the risk of sparking a recession, as interest rates are already higher than what the Fed officials believe to be the neutral rate.