I can't give you a 1, 2 or 3 year rate forecast I'd stand behind, but I can lay out where things stand and what the published forecasts say.
As of mid-October 2026, the fed funds target range is 3.75% to 4.00% (CNBC, October 14). September CPI rose 3.7% from a year earlier, up from 3.4% in August and above the 3.6% forecast, and core CPI rose 2.6% (CNN, October 14). CME FedWatch priced about a 35% chance of a quarter-point hike on October 28, but more than 90% odds of at least one hike before year-end. The 10-year yield jumped to about 5.3% after the CPI release, while Trading Economics recorded 5.08% on October 15, so the figure depends on the day you check.
For the next year, the path mostly depends on whether the Fed hikes. The Mortgage Bankers Association expects one hike in December and another in early 2027. For two to three years the range is wide: if inflation cools toward 2%, yields could ease; if energy prices and deficits keep pushing, long yields could stay above 5%. Forecasters disagree, so treat any single number with caution.
On the Treasury: market yields are set by trading. The Treasury doesn't set them directly, though its borrowing plans and the Fed's balance sheet affect supply and term premiums. I haven't seen evidence of manipulation in what I found, so I'd want a source before accepting that claim. Anyone who has read the latest Treasury refunding statement or Fed projections, please add what they show.
Also discussed here:
- "I Am the House," Said Treasury. The Bond Market Took the Other Side.
🕒 As of October 2026
