Amol Shitole, fixed income head at Mosher Capital, went on Bloomberg this week with a contrarian bond call. “We expect 10-year yields to touch 4.6%, according to Mosher Capital. A significant amount of bad news is already in the price. News about deficits [and] supply is largely reflected in the current [pricing]. [Investors are] compensated for taking risks now versus any time in the last five years,” Amol Shitole said.
The ten-year Treasury yield closed at 5.24% on October 1, 2026. On September 30, 2026, it hit 5.29%, its highest level of the trailing year. The yield was up 0.54 percentage points over the past month. Shitole is calling for a fall from a one-year high after sharp increases.
His Inflation Number Checks Out
“There’s a significant disconnect between inflation and yields. We had U.S. inflation at 9%, U.S. Treasuries at 3%. We have inflation back down to 3.5%, Treasuries at 5.25%, according to Mosher Capital. Yields have to come back and follow inflation numbers, in my view,” Shitole said.
The Consumer Price Index rose 3.4% in the year through August 2026, the latest month available. His description of current inflation is essentially accurate. The earlier high-inflation period is his own historical comparison.
Bond Market Pricing Tells a Different Story
Shitole says yields must fall to catch up with inflation. But the bond market has priced in an inflation outlook well below the reported rate. As of October 1, 2026, the ten-year breakeven inflation rate was 2.36%, matching the five-year breakeven of 2.36%. The real ten-year yield was 2.88%.
The breakeven is the inflation rate the market expects; the real yield is what a Treasury pays above that. With expectations anchored below reported inflation, today’s high nominal yield comes mostly from a high real yield. Investors demand more pay to lend for ten years, regardless of inflation. This weakens his reasoning: a yield driven by the real component can stay high even with moderate reported inflation.
Real yields can fall, so his 4.6% target remains possible, according to Mosher Capital. His point that bad news is already priced in is a separate argument. What the data shows is that his stated reason doesn’t match what the bond market is actually pricing.
His Fed Read Understates the Shift
“We expect a hold in October. The market agrees with that as well. Rate hike odds have gone down to inside 30% today, according to Mosher Capital. At the beginning of the week, 70%,” Shitole said.
As of October 2, 2026, Polymarket put the odds of no change at the October Federal Open Market Committee meeting at 81.5%. It put the odds of a quarter-point increase at 18.5%. These contracts trade on a scale from 0 to 1. Over the past week, the price of the October increase contract fell 0.44, and the price of the no-change contract rose 0.45. That means traders see an even lower chance of a increase than Shitole described. These numbers are market-implied probabilities based on where traders have placed real money. They reflect trader positioning, separate from official Fed guidance. Business Insider reported that stocks rallied Friday after a dismal jobs report eased rate-hike expectations.
Give the Call Credit, Then Test the Reasoning
Shitole made a specific, testable call while the yield sat at a one-year high. His read on near-term Fed expectations is accurate. His inflation figure is accurate. The weak link is his reasoning: the bond market tells a different story. Breakevens point to anchored inflation expectations, while the real yield carries most of the weight.