10-Year U.S. Treasury Yield Shows Upside Potential, According to ING

Analysts at Dutch bank ING are highlighting the breakout potential in the 10-year U.S. Treasury yield, currently at 4.09%, a development that could spell trouble for crypto investors. Despite soft economic data, including November’s ADP employment report—the third contraction in five months—the yield has held steady above 4%, aligning with CoinDesk’s outlook.

A higher yield could tighten financial conditions, discourage risk-taking, and put pressure on riskier assets such as cryptocurrencies. “Treasuries love that 4% to 4.1% trading range. Temporary break below more likely. But break above has more legs,” ING said in a client note Thursday.

The benchmark yield briefly dipped to 4.06% following the ADP report before quickly rebounding, defying typical patterns where weak labor and inflation data signal falling interest rates. Expectations for a Federal Reserve rate cut this month have risen to 87%, yet the 10-year yield has remained largely between 4% and 4.20% since September.

ING attributes this stickiness to structural shifts in the U.S. economy, where productivity gains, partly driven by AI, are taking precedence over employment growth. “Fewer net immigrants reduce the need for job creation, while productivity growth—AI among other factors—is driving expansion,” the analysts noted.

Friday’s personal consumption expenditures (PCE) report could introduce volatility. A softer reading may push yields temporarily below 4%, while a decisive move above 4.1% could indicate a more sustained shift, potentially influencing markets well into 2026.