Volatility in the Treasury market likely isn't over and the 10-year yield could reach 5%, BlackRock says

• Volatility in the US Treasury market isn't over yet, BlackRock strategists warned.
• The asset manager said the 10-year Treasury yield will probably hit 5%. 
• Yields in the near-term could still swing in either direction as the Fed grapples with the "politics of inflation."

The US Treasury market is still in for big swings of volatility, which could push the yield on the 10-year Treasury bond to 5%, according to BlackRock.

"We have been underweight long-term US Treasuries since late 2020 as we saw the new macro regime heralding higher rates. US 10-year yields at 16-year highs show they have adjusted a lot – but we don't think the process is over," the asset manager's strategists said in a note on Monday.