HSBC Raises U.S. Treasury Yield Forecasts on More Hawkish Policy Path

According to Jin10, HSBC raised its forecasts for U.S. Treasury yields across all maturities, with U.S. rates strategist Dilraj Narula saying the revision reflects the bank's view that future monetary policy may follow a more hawkish path and that the structural floor for long-term U.S. Treasury yields will also be higher. HSBC now expects the 2-year U.S. Treasury yield to be 4.20% at the end of 2026, versus a previous forecast of 3.85%, and 3.95% at the end of 2027, versus 3.50% previously. For the 10-year U.S. Treasury yield, HSBC now expects 4.65% at the end of 2026, versus 4.30% previously, and 4.75% at the end of 2027, versus 4.40% previously.