10Y Term Premium

When long-term Treasury yields rise, this helps separate "the Fed will cut rates" from "bond investors are worried about inflation, deficits, or supply." Rising term premium means compensation for holding duration is growing — driven by things outside Fed policy like fiscal concerns, reduced foreign demand, or inflation uncertainty. Important because term premium sets mortgage rates, corporate borrowing costs, and the discount rate equity investors use to value future earnings — a rising term premium is a headwind for housing, stocks, and corporate investment even if the Fed isn't moving. The chart uses the NY Fed's ACM model as the primary line, with the Kim-Wright model overlaid as a cross-check — the two can diverge in any given month.