James Reilly: AI bond issuance has limited impact on US bond yields, dropping to 4.25% by the end of 2027

Kaitou Macroeconomist James Reilly stated that the US bond sell-off was driven by changes in market expectations for recent interest rates, rather than artificial intelligence related bond issuances or fiscal concerns. James Reilly predicts that as the Federal Reserve tightens less than expected, the 10-year Treasury yield will drop to 4.25% by the end of 2027, and the impact of artificial intelligence related bond issuance will be limited and offset by changes in monetary policy expectations.