With Treasury yields confounding predictions they would rise this year, one bank is polishing up its previously tongue-in-cheek prediction the 10-year yield would fall to 1.5 percent.
"We're more than halfway there," DBS said in a note Wednesday, of its "Holiday Heresy" prediction at the end of last year that rather than the market's prediction the yield would rise to 3.50 percent, it would instead fall, citing its belief the global economic recovery wasn't as strong as the market expected.
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The 10-year U.S. Treasury yield rose from 1.60 percent in mid-May of 2013, when the Federal Reserve first broached its plan to taper its asset purchases, to around 3.0 percent at the start of 2014, around the time DBS made its prediction.
But despite expectations it would rise further, the yield has retraced, trading at around 2.128 percent in early Asia trade Thursday after falling as low as 1.865 percent Wednesday to touch around 17-month lows as it has trended down for around a month. Bond prices move inversely to yields.