Analysts at Macquarie said in a note Wednesday that the 4.75% level for the US Treasury 10-year yield is "easily in view."
They commented that given the intra-day high of 5% was reached in October 2023 when the outlook for nominal US GDP growth was looking weaker and inflation was falling, 5% may also be in reach also over the next few weeks.
Looking elsewhere, Macquarie notes that the other important fall-out from higher US yields has been in developed market currencies, especially emerging market currencies.
"Of course, the stronger USD vs. the EUR, GBP, JPY, CAD, and CNY has put some competitive pressure on Latin American currencies, as they all have important export sectors and rely on global demand more than they used to, especially Brazil and Chile," wrote analysts.
"But EM currencies have seen an outsized move compared to the DM currencies, as they often do in situations that combine a strong USD with higher US yields, and a general risk-off sentiment," they explained. "The 'classical' reason for these large moves used to be that EMs are highly indebted (sometimes with large USD obligations), dependent on external capital, and with much of that by way of 'hot money' from abroad. So when yields rise in the DMs, money would flow from EMs to DMs."