Macro bulletin: the biggest bond repricing of the 21st century
Rate hikes and futures pricing, Treasury and gilt yields at multi-decade highs, oil and the Hormuz scenarios, gold and the dollar, equity targets, and what it all means for the assumptions in your models.
Key points
- The Fed raised rates 25bp to 3.75–4.00% on 16 September; futures put about a 70% chance on another rise in October (Federal Reserve, CME FedWatch).
- The 10-year Treasury touched 5.225%, its highest since 2007, and the 30-year reached 5.502%; Bloomberg's global sovereign index yield hit 4.04%, the highest since 2000.
- The 10-year gilt traded near 5.40%. The SONIA curve implied Bank Rate near 4.8% by September 2027, against 3.25% in the Bank's own market participants survey.
- Brent settled at $104.32 on reports of a phased deal to reopen the Strait of Hormuz; Goldman's scenarios run from the $60s to above $120.
- Gold traded near $4,280, short of UBS's $4,600 December path, as higher real yields and a firmer dollar weighed (EUR/USD near 1.14).
- The S&P 500 closed at 7,743, close to Goldman's year-end 8,000; Morgan Stanley's mid-2027 target is 8,300.
- Forecasts age in days: carry the market and survey rate paths as scenarios, model the oil range with triggers, and date every assumption.
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