Back in mid-2020, a common sentiment toward interest rates was that they would stay historically low for the foreseeable future.

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Indeed, in July of that year, no less than the Bank of Canada governor said (BNN Bloomberg):

‘Interest rates will be low for a long time’: Macklem

The next month, in August 2020, a Wall Street Journal headline used more dramatic language than “foreseeable future”:

Low Rates Forever!

In the same month and year, one chief investment officer also used the word “forever” in regard to low rates by saying, “We are moving from low for longer to low forever.”

The reason the mainstream was SO convinced was simple: 2020 was the first year of the pandemic, and it was widely believed that low rates would have to stay “forever” to “stimulate the economy.”

So, the July 2020 Elliott Wave Financial Forecast, a monthly publication which offers analysis of major U.S. financial markets, was going squarely against the prevailing sentiment toward interest rates when it said:

The Bloomberg Barclays U.S. Aggregate Corporate Bond Yield is at a record low 2.15%. The  Bloomberg Barclays U.S. Aggregate Corporate Duration, is at a record high 8.6. Bond duration is a measure of how sensitive prices are to a move in interest rates. … Bond investors are now making a hugely dangerous bet that interest rates will stay low forever.

Fast forward to the April 2022 Elliott Wave Financial Forecast, which shows you what has happened since that July 2020 analysis:

Corporate yields declined slightly further, to an all-time low at 1.74% on December 31, 2020, but they have since surged to 3.76%, more than doubling.

So much for the “low forever” sentiment.

Indeed, on April 14, a Bloomberg headline said:

Corporate Bond Rout is So Severe History Books Need a Revision

And, relatedly, on May 2, a CNBC headline noted:

10-year Treasury yield tops 3% for first time since 2018

And, given the Fed has historically followed the market, another CNBC headline — this one from May 4 — is not surprising:

Fed raises rates by half a percentage point — the biggest hike in two decades — to fight inflation.