Rare! The Federal Reserve has begun a rate-cutting cycle, yet U.S. long-term bond yields have surged

The Federal Reserve began its rate-cutting cycle in September, having lowered rates by 100 basis points, yet the yield on the 10-year U.S. Treasury bond has risen by a cumulative 100 basis points, a rare occurrence. Historically, only the 1981 rate-cutting cycle performed weaker. The market may be pricing in fiscal concerns, reduced demand, or a lack of rationale for rate cuts. Francis Yared of Deutsche Bank believes that the market has largely completed the repricing of interest rates and expects the yield on 10-year bonds to be 40 basis points higher