Currency and capital market strategists at Krungthai GLOBAL MARKETS, a unit of Krung Thai Bank Public Company Limited, or KTB, said the 10-year US bond yield is moving volatilely in a sideways range around 5.20%-5.30%, and maintained their recommendation for market participants to gradually buy long-dated US bonds when yields rise, or Buy on Dip, after the 10-year US bond yield climbed above the 5.20% zone. This pushes the break-even yield that would turn holding long-dated bonds into a loss on a total return basis as high as 5.70%-5.80%, which could happen if market participants believe the Fed may need to accelerate rate hikes or raise rates another 3-4 times, or roughly 75 basis points to 100 basis points, from the current expectation that the Fed may hike rates about 3-4 more times by the middle of next year. This view is consistent with market participants scaling back the odds that the Fed will hike rates twice this year, following recent remarks by Fed officials and the gradual decline in energy prices. In the currency market, the dollar moved in a sideways range, with the dollar index DXY still fluctuating around 101.4 points within a 101.2-101.6 range. Meanwhile, gold prices, specifically COMEX gold futures for December 2026 delivery, gradually rebounded to the 4,200 dollars per ounce zone once again, driven by hopes for a ceasefire negotiation trend between the United States and Iran and by views that have somewhat reduced the odds of further Fed rate hikes.
Krung Thai Bank Public Company LimitedKTB's strategists recommend gradually buying long-dated US bonds on dips, but this is a market call, not a company-specific development.
10-year US bond yield surged above 5.20% on expectations the Fed may hike rates 3-4 more times, pushing yields higher (bond prices lower).
