Summary

Murray Gunn discussed the case for US 10-year Treasury yields rising towards 8.5% over the next few years. The argument rested on three main pillars: renewed inflation pressure led by commodities, a weakening dollar, and market behaviour pointing to a further rise in yields. The presentation linked higher oil and broader commodity prices to a potential re-acceleration in inflation, while also arguing that gold could continue to move higher as fear, rather than yield logic, becomes the dominant driver. The broader backdrop was one of potential stagflation, pressure on US fiscal credibility and vulnerability across global bond markets. Dollar weakness was framed as part of a longer-term challenge to US reserve-currency dominance, with rising interest costs and Treasury funding pressures adding to the concern. The call also touched on risks across Bunds, JGBs, gilts and Australian yields, suggesting that the pressure on rates is not limited to the US. A key risk highlighted was the possibility of strain in Treasury auctions if confidence in the dollar continues to weaken.

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