Pimco Sees A 6% 10-Year... Here's Why "Bad Inflation" Caps Yields

PIMCO chief investment officer Dan Ivascyn said a 6% yield on the 10-year Treasury is “certainly possible,” but the inflation data behind that move looks more like a temporary, supply-driven shock than durable price pressure. The 10-year yield recently hit 5.31% on Oct. 5, the highest close since May 2002, up from 4.18% at the start of the year. Ivascyn attributed part of the recent spike to “negative technicals,” including stop-out activity from platform hedge funds and other levered investors—raising a risk warning that yields near or above 5.5% could weaken credit and equities. Yet energy-led CPI rose while core CPI and wage growth cooled, limiting the case for sustained 6%.