There’s been a lot of discussion of upward movements in long term interest rates. I thought it useful to consider the revisions in expectations, over time, and in context.
Figure 1: Ten year constant maturity Treasury yields (black), and expected ten year yields by vintage. Source: WSJ, June 2013 survey, St. Louis Fed FRED, NBER.
- The path of interest rates, while higher than that implied by the December 2012 survey, is lower than the September 2012 path.
- Expected yields as of end 2015 are about the same as than those recorded at the end of the recession.