Yardeni Sees Inflation Cooling, Says US Yields Attractive at 5%

Ed Yardeni, president of Yardeni Research, states that US 10-year Treasury yields around 5% are very attractive. He expects inflation to cool, driven by productivity gains, which will allow bond coupons to outpace inflation over the next decade. While these yields offer an attractive real return, Yardeni maintains that stocks will continue to outperform bonds over the long term. His analysis suggests a favorable window for Treasuries as inflationary pressures are expected to subside significantly.