Ed Yardeni, president of Yardeni Research, just told investors to keep a close eye on the 10‑year Treasury, noting it sits at 5.2% today.
The 30‑year is still a touch higher at 5.6%, and the market has just trimmed the 70‑plus‑percent odds of a Fed rate hike that were priced in last week.
GDP is turning up at about 3.5%, payrolls averaging 50,000 a month, and unemployment staying near 4‑4.5%, so the economy looks solid even as the yield curve nudges up.
Yardeni says the Treasury could step in with a large buy‑back—Scott Bessent might deploy $15‑25 billion—if yields keep climbing toward 6%, a move that would shake the bond market.
For emerging markets, the higher global rates and the unwinding of the yen carry trade could trigger capital outflows, and investors in India should watch the Fed’s stance closely.
Looking ahead, Yardeni argues rates will stay ‘normal for longer’ rather than ‘higher for longer,’ but the 6% threshold remains a red flag for growth.