Most Wall Street analysts predicted a bear market for bonds in 2014 and got it wrong. Who's to say they'll get it right this year?
After all, today's consensus forecast is similar to what it was a year ago: U.S. government-bond yields will finally start climbing as the Federal Reserve prepares to raise interest rates. Analysts predict benchmark 10-year yields will rise to 3.06 percent by year-end, up from 2.05 percent today.
This seems reasonable if oil prices stabilize after plunging as much as 50 percent in 2014. And if U.S. economic growth accelerates to a 3 percent rate from 2.3 percent last year, as predicted in a Bloomberg survey of analysts. And if Europe also avoids deflation as policy makers pump stimulus into the region.
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