The Federal Reserve and Wall Street have projected that a surge in long-term Treasury yields, the highest since 2007, could bring an end to 19 months of historic interest rate hikes. As per the CME FedWatch Tool, financial markets predict a 90% likelihood of rate stability at the upcoming policy meeting scheduled from October 31 to November 1, indicating a decreased chance of another rate hike in November.
The rise in 10-year Treasury yields is leading to increased costs for car loans, credit card rates, student debt, and mortgage rates, which in turn is negatively affecting home affordability. This development has sparked a surge in consumer anxiety over the possibility of missing minimum debt payments, as indicated by data from the New York Federal Reserve.
Looking ahead, most traders anticipate no further hikes, with interest rates expected to remain steady until June 2024 before any policy easing occurs. This forecast aligns with the prevailing sentiment that the escalation in long-term Treasury yields could mark the end of the recent cycle of interest rate increases.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.