This 'toxic brew' is driving rates higher, says Societe Generales Subadra Rajappa

• Rising bond yields are attributed to a 'toxic brew' of factors including geopolitical tensions (Iran War), surging oil prices, and current Fed policy.
• Societe Generale forecasts the 10-year Treasury yield could reach 5.25% by year-end, with the Fed delivering three 25 basis point rate hikes (September, December, March).
• The Fed's commitment to fighting inflation by delivering expected rate hikes is seen as crucial to prevent further market discomfort and unhinged inflation expectations.

Subadra Rajappa of Societe Generale describes the current market environment as a 'toxic brew' driving bond yields higher, citing the Iran War, surging oil prices, and Fed policy. She forecasts the 10-year Treasury yield could reach 5.25% by year-end, with the Fed implementing three more 25 basis point hikes. The market's reaction to Fed action, or inaction, will be crucial for future volatility.