iCapital has projected that the 10-year U.S. Treasury yield will reach 4.5% in 2026. The firm anticipates that if yields approach the upper limit of their forecasted 4.0%-4.5% range, risk-on assets could experience increased pressure. Additionally, iCapital warns that if concerns over the U.S. deficit grow, yields might rise further in the latter half of the year, potentially driving investors towards risk-off assets. This outlook indicates potentially tighter conditions for capital markets and risk-on assets in the near future.