The Higher Floor - Is 5% Structural? Reading the Long Bond’s Fiscal Term Premium

Central BanksFiscal Policy
Written By Pallavi Sehgal

The 30-year Treasury has spent its longest stretch above 5% since 2007. The question that matters for allocators is not the level but the composition — whether a permanently larger share of the long yield is now compensation for fiscal risk rather than a passing echo of restrictive policy. This note decomposes the long bond, sorts the structural from the cyclical, and lands on a house view.

#TreasuryYields, #TermPremium, #FiscalPolicy, #Duration, #SovereignDebt, #AssetAllocation, #Macro, #Rates

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