Dutch bank ING is signaling potential upside in the 10-year U.S. Treasury yield, currently at 4.09%, a development that could weigh on risk assets like cryptocurrencies. Despite several weak economic reports, including November’s ADP employment data—the third contraction in five months—the yield has remained above 4%, consistent with CoinDesk’s outlook.
A rising yield could tighten financial conditions and discourage risk-taking. “Treasuries love that 4% to 4.1% trading range. Temporary break below more likely. But break above has more legs,” ING said in a Thursday note to clients.
The yield briefly fell to 4.06% following the ADP report but quickly recovered, an unusual move given that weak labor and inflation data typically signal lower rates. Even with an 87% chance of a Federal Reserve rate cut this month, the 10-year yield has held between 4% and 4.20% since September.
ING attributes the resilience to structural shifts in the U.S. economy, where productivity gains—partly driven by AI—are outpacing employment growth. “Fewer net immigrants reduce the need for job creation, while productivity growth is driving expansion,” the analysts wrote.
Friday’s personal consumption expenditures (PCE) report could spark volatility. A soft reading might temporarily push yields below 4%, but a sustained move above 4.1% could signal a more structural trend, shaping market conditions into 2026.
