The 10-Year Treasury Yield Briefly Makes it over 5%. Last Time, 5% Instantly Opened the Floodgates of Demand
But 5% was considered normal to low in the decades before the Fed’s financial repression kicked off in 2008.
Source: Wolf Street
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DW NOTE
The last time the 10-year hit 5%, in October 2023, it stayed there for three days before falling 100 basis points in eight weeks. Demand didn't flood in — leveraged funds capitulated. This time the Fed is expected to hike into a supply shock with oil at $102 and the Strait of Hormuz closed since February. If 5% couldn't hold with inflation falling, it won't hold with inflation accelerating.