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US 10-Year Yields Meet Our 2.07% Target

Posted on: Wednesday, October 15th, 2014

The yield of the benchmark US 10-Year Treasury Note has declined to as low as 2.03% thus far this morning, meeting our 2.07% downside target first mentioned in our May 16th report, entitled Now That Our 2.51% Target Has Been Met, What’s Next For US Interest Rates?, when these yields were trading at 2.52%.

Meanwhile, the iShares 20+ Year Treasury Bond ETF (TLT) has coincidentally risen by $10.94 or 10.0%.  For perspective, the S&P 500 has declined by 1% during this same period.

From that report:

Now that our initial 2.51% downside target in the yield of the US 10-Year Treasury Note has been met, our focus turns to a much more important level at 2.40%.  Meanwhile, unmet upside targets in the CBOT 10-Year Note and the iShares 7-10 Year Treasury Bond ETF (IEF) suggest that at least an addition 2% to 3% rise in mid to long dated US Treasury prices is likelyWe will view these two assets’ proximity to their upside targets, if and when 10-Year yields decline to 2.40%, as an indication of whether the 10-Year continues even lower to its next key level at 2.07%…”

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