From Global Stock Surges and Firm Gold to Emerging Market Carry, This Year's Cross-Asset Rally Is Built on the Assumption of "Lower Real Rates"—But Is It Correct?

Goldman Sachs analysis notes that the current cross-asset boom—spanning stocks, gold, emerging market carry trades, and narrowing credit spreads—fundamentally shares a single logic: real interest rates are poised to decline. However, the 10-year U.S. real yield remains elevated at around 2.50%, and this key premise has yet to materialize. Goldman advises against fighting the carry narrative for now, but recommends managing position sizes, using the trajectory of real rates as the ultimate deciding factor.