Markets are well advanced with pricing in an aggressive rate hike cycle by the Federal Reserve (Fed) and the European Central Bank (ECB). Economists at ABN Amro expect the 10-year US Treasury yields to dip toward 2.7% throughout the rest of 2022.

Expecting lower Euro rates as well as US rates

“We judge that markets run ahead of itself and we expect repricing of central bank hikes downwards in both the US and the Eurozone. This would, in turn, result in lower Euro rates as well as US rates.”

“We expect the 10y US Treasury yields to drop from around 2.9% to 2.7% during the course of this year.”