The bond market, not the Fed, is now setting America's borrowing costs.
Traders pricing three more hikes by mid-2027 have already driven the 2-year to the threshold of 5%, the 10-year to a 19-year high above 5.27%, and 30-year mortgages past 7% — tightening that no FOMC vote has actually delivered.
The same conclusion keeps arriving from across the workspace's research — 1 topics independently instantiate this theme. Filter the evidence by where it came from:
Long-end yields and 7.40% mortgages keep tightening credit with no FOMC vote, exactly the regime where the bond market, not the Fed, sets America's borrowing costs.
A friendly jobs print that should have rallied bonds left the 10-year at multi-decade highs — the market, not the FOMC, is setting borrowing costs.
The committee's decision is explicitly subordinated to long-end yields already delivering the restriction no FOMC vote has actually enacted.