The U.S. 10-Year Treasury yield (TNX) could approach 5% as strong macroeconomic data and a hawkish Federal Reserve prompt a reassessment of U.S. rate outcomes, according to a recent report by BofA Global Research. Analysts Ralph Axel, Bruno Braizinha, and Mark Cabana suggest that the market is currently pricing a 10-year Treasury yield of around 4.83%, but it could rise further if economic conditions continue to strengthen. "We expect the market will struggle to price 10y UST meaningfully above 5.25%," the analysts note, citing the need for expectations of U.S. economic re-acceleration and several Fed hikes to reach such levels. The report outlines two frameworks for understanding potential rate outcomes: the Fed policy path combined with asset swap spreads, and a macroeconomic approach. Both frameworks indicate that the recent rate rise could continue, especially if the 10-year yield nears post-COVID highs.