Societe Generale Strategists Expect Fed Rate Cuts and Falling U.S. Treasury Yields by the End of 2026

COINOTAG News notes a Societe Generale strategy piece suggesting the U.S. economy remains resilient in the face of sticky inflation, with the labor market showing only modest deterioration. In this context, the analysts argue that Treasury yields could drift lower through 2026 as policy expectations recalibrate and risk sentiment stabilizes, creating a more accommodating backdrop for longer-duration exposure. The note emphasizes that the near-term path will hinge on the evolution of inflation data and payroll dynamics, shaping the fixed-income outlook.

On policy, the team envisions a December rate cut, followed by two further Fed rate cuts in 2025. If this path unfolds, the two-year Treasury yield could approach 3.20%, and the ten-year yield around 3.75% by end-2026, aligning carry potential with controlled duration risk. Readers should anchor bets to macro releases and FOMC communications, avoiding overinterpretation of any single data point.