Reasoning
The 10 year yield starts at 4.617 percent with the federal funds target range at 3.50 to 3.75 percent and the June 2026 SEP median projecting 3.8 percent for year end 2026. Nine of eighteen SEP participants see the year end 2026 rate above the current range, and the June 17 meeting erased the prior cutting bias under Chair Warsh. Historical patterns show that yields above 5.00 percent require either sustained inflation above 3 percent or federal funds above 4.5 percent, neither of which is priced in current data.Key uncertainty
Whether the September 2026 CPI release shows a reacceleration above 3.2 percent year over year.