SBI Report Projects US 10-Year Yields Near 4.75%
An SBI Ecowrap analysis estimates US Treasury supply exceeds investor absorption capacity amid a 6.15% fiscal deficit.
Updated on Nov. 1, 2026 in Economic Policy
An SBI Ecowrap report projects that US 10-year Treasury yields could settle around 4.75 per cent, down from current levels near 4.9 per cent. The analysis estimates a $304 billion excess supply of US Treasuries, consistent with a fiscal deficit of 6.15 per cent of GDP.
Why it matters
The imbalance between government debt issuance and investor demand influences borrowing costs across the economy. The report also links the US supply-demand gap to bond market conditions in India.
The SBI assessment, a demand-supply estimate for government securities, puts US excess Treasury supply at $304 billion, against a comparable 2015 mismatch of about $140 billion when the deficit was 2.5% of GDP. Whether the gap narrows depends on fiscal measures that remain undetermined.
The players
State Bank of India (SBI)
India's largest public sector bank, whose Ecowrap research unit produced the demand-supply assessment of government securities.
The details
Excess supply is concentrated in securities above 10 years (about $108 billion of the mismatch) and the 1-5 year segment (about $96 billion). The report projects a short-term rise to 5.25-5.35 per cent is not ruled out during the mid-term elections.
Timeline
November 9: potential date after which meaningful US fiscal measures could move yields toward 4.75 per cent.
Mid-term elections: a verdict could favour Democrats and shape the fiscal outlook.
Macro View
The current excess supply of $304 billion roughly doubles the 2015 mismatch of about $140 billion, when the US deficit was 2.5 per cent of GDP. The widening gap tracks the rise in the deficit to 6.15 per cent, a pattern that links fiscal policy directly to Treasury yield levels.
Higher Treasury yields raise borrowing costs for mortgages, car loans and other consumer credit tied to benchmark rates. Households tracking interest rates should watch whether the projected move toward 4.75 per cent materializes after fiscal decisions in November.
The takeaway
Bond market supply pressure can move borrowing costs even without a change in central bank policy. Tracking fiscal deficit trends offers a useful signal for where Treasury yields may head.
What happens next
Potential US government fiscal measures are expected to be considered after November 9, which could move 10-year yields toward 4.75 per cent.
Further reading
Explore more on Economic Policy to see how fiscal decisions shape Treasury yields.
