In previous cycles, the 10yr yield typically managed to fall, appreciably (blue line in graph below). In the current cycle, the 10yr yield has in fact risen post the peak, and hit its cycle high of 5% in October 2023, some three months after the funds rate peak. And it remains elevated. What is clear is market rates have not fallen by anything near what would have been typically expected from a “Fed peak moment”. Firm labour market data and pops in inflation data have muddied the water. And the latest payrolls report largely contains more of the same. History shows that when the Fed actually cuts for the first time, ... (full story)