Speaking of Goldman, Firm Says Yields are Going Even Lower
By Matt Phillips
Would you lend the U.S. government money for 10 years at 2.5% interest? Goldman Sachs says the bond market likely will. Dow Jones Newswires’ Min Zeng reports:
Goldman Sachs, one of the biggest Treasury bulls on Wall Street, turns more bullish, believing that weak economic growth will push the Fed to maintain low interest rates while buying bonds to support the economy. Goldman strategists expect the 10-year note’s yield to fall to 2.5% during the fourth quarter, a level not seen since March 2009. The previous call was 3.25%, which was already broken in recent weeks. The five-year note’s yield is likely to drop to a record low of 1% during the same period, from 2% previously predicted, the strategists said in a research note Friday.
In the ongoing war of attrition between Goldman Sachs and Morgan Stanley, it seems that Goldman has won the battle of the bond-market calls. As The Journal’s Mark Gongloff wrote back in April:
The two best economic forecasting teams of the past two years couldn’t disagree more about where Treasurys will go next. Morgan Stanley believes the 10-year yield will rise to 5.5% this year, the highest estimate among top Treasury dealers. Goldman Sachs Group Inc. says yields are headed back down to 3.25%.
After yields on the 10-year began to plunge in early April, Morgan Stanley was forced to concede that it was off base on its call, trimming its forecast for the 10-year to 4.5% in May, and then shortly cutting it again to 3.5%. |
狗仔卡
发表于 2010-8-6 01:40 PM
发表于 2010-8-6 01:40 PM
