Fixed Income Q&A with Jim Bernard
Thursday, May 22, 2014
Q. What is your outlook for interest rates and the economy?
A. We will continue to see modest (2%-3% real GDP) domestic economic growth over the next few years, and if our forecast proves to be fairly accurate we would expect the 10 year U.S. Treasury to yield modestly above 3% either later this year or early in 2015. We further expect the FED to complete the current QE (Quantitative Easing) Program later this year or in early 2015. However, even when this program concludes we believe it will likely be six to twelve months before the FED takes any action to increase short-term interest rates.
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