MarketWatch reports that one well-known analyst said that a bond market selloff is calling the tune across financial markets, including for foreign exchange, and equilibrium is unlikely to return until the yield on the benchmark 10-year U.S. Treasury note hits 2%.

“There will be no peace until U.S. 10s reach 2%,” said Kit Juckes, global macro strategist at Société Générale, in a note.

A pair of U.S. government bond auctions, which had been a source of nervousness, went off without any major problems over the past week, with yields settling into a new and higher range, Juckes said. 

Rising yields have triggered rotation away from growth-oriented stocks, including large-cap, tech-related shares, into more cyclically sensitive and often value-oriented stocks and sectors.

The rising yields have resulted in renewed strength for the dollar, which Juckes said he wasn’t eager to fight at the moment.

“The pattern seems clear enough: The equity market is seeing a sector rotation but not a correction; the bond market is seeking a new equilibrium in the light of a vastly improved economic outlook in both the U.S. and elsewhere; some policy makers are pushing back against the bond moves, with little success,” Juckes wrote.

“As yields rise, the dollar rallies, but when yields settle at a new level, the dollar drops back. The pattern probably goes on until bonds find an equilibrium, unlikely before 10-year note yields have a 2-handle, judging by taper tantrums and past cycles,” he said.