Bank of France: Fed rate cuts are expected to drive US bond yields lower through the end of 2026.

The interest rate strategist at Societe Generale in France stated in a report that the upcoming economic data should continue to show that the US economy is resilient, inflation is sticky, and labor market conditions are moderately deteriorating; however, by the end of 2026, there is still room for a decrease in US Treasury yields. These strategists said: "After the rate cut in the December meeting, we expect the Fed to cut rates twice next year." They predict that by the end of 2026, the two-year US Treasury yield will steadily decline to 3.20%, and the ten-year US Treasury yield will fall to 3.75%. According to Tradeweb data, during the Asian trading session, the two-year US Treasury yield rose by 0.5 basis points to 3.495%, and the ten-year US Treasury yield rose by 2.5 basis points to 4.043%.