What Do the Midterm Results Mean for Rates?
It connects an election outcome to the two variables advisors are fielding client questions on: federal borrowing needs and the path of Fed policy. It offers a specific 10-year yield range to weigh against other manager views.
Summary
By the markets & outlook deskKevin Flanagan and Maggie Lucier discuss what the midterm election results could mean for the fiscal outlook and Treasury yields on the Basis Points podcast. They argue political gridlock may not translate into less federal spending or lower yields, with deficits and potential spending deals keeping Treasury supply in focus. Flanagan also explains why another Fed rate hike remains possible in December and restates his 4.50%–5.25% trading range for the 10-year Treasury yield.
- Political gridlock may not mean less federal spending or lower Treasury yields
- Deficits and potential spending deals keep Treasury supply in focus
- Another Fed rate hike remains possible in December
- Flanagan maintains a 4.50%–5.25% trading range for the 10-year Treasury yield
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