Bloomberg Surveillance · Friday, September 25, 2026
Darius Dale stated that his models estimate the fair value of the 10-year nominal Treasury yield at 6.04%, suggesting that yields could go higher. He believes this will occur unless the Federal Reserve implements further rate hikes or employs measures like Treasury General Account (TGA) funded buybacks or yield curve control.
“Bonds are not at their equilibrium price level. We run five sophisticated models that try to ascertain what the fair value of the 10-year nominal treasury yield is, and the mean of those models is 6.04%.”
“We can and likely will go higher until one of two things happens. The Federal Reserve hikes two to three more times to truncate its accommodative policy bias. Or we see an expansion of buybacks via the Treasury, TGA-funded, and or bank deregulation, reserve management purchases, or yield curve control out of the Fed that sort of caps yields at a certain level.”