Economists increased their forecasts for U.S. 10-year yields for the second time this year, while Morgan Stanley said minutes tomorrow of the Federal Reserve’s policy meeting last month may send Treasuries lower.

The rate will rise to 2.32 percent by Dec. 31 from 2 percent today, according to Bloomberg surveys, with the most recent predictions given the heaviest weightings. The forecast has climbed from 2.14 percent in the first week of January. The last Fed minutes on Jan. 3 showed policy makers were divided on whether to end bond purchases in the middle or end of this year. Ten-year yields climbed to an eight-month high the next day.

“The minutes may cause some shock in the bond market again,” said Hiroki Shimazu, an economist in Tokyo at SMBC Nikko Securities Inc., a unit of Japan’s second-largest publicly traded bank by assets. “They will start to slow their purchases by the end of the year.”

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Ten-year yields were little changed at 2 percent as of 7:03 a.m. in London, according to Bloomberg Bond Trader data. The price of the 2 percent security due in February 2023 was 99 31/32. Treasuries opened in Asia after being closed worldwide yesterday for Presidents’ Day.

Yields have climbed about a quarter percentage point in 2013. They are less than the 10-year average of 3.63 percent.

Japan auctioned five-year notes at an average rate of 0.122 percent, the lowest level since the government began selling the notes in 2000.

Market Risk

The Fed minutes are a “risk” for the market, Matthew Hornbach, Morgan Stanley’s head of U.S. interest rate strategy, wrote in a report Feb. 15.

“We continue to see the risks skewed toward higher Treasury yields,” the report said. Investors may consider adding to holdings if rates push higher this month or next, according to Morgan Stanley, one of the 21 primary dealers that trade directly with the Fed.

The Fed said after its last meeting that it is committed to buying about $85 billion of government and mortgage securities a month to support growth in the world’s biggest economy.

The central bank’s price indicator for the period from 2018 to 2023, known as the five-year five-year forward break-even rate, climbed to 2.97 percent last week, the most since August 2011.

Labor Department data on Feb. 21 will probably show U.S. consumer prices rose 1.6 percent in January from the year before, slowing from 1.7 percent in December, according to a separate Bloomberg survey.

Housing Data

New residential construction cooled in January, a report tomorrow will say, and U.S. existing-home sales slowed, data Feb. 21 will show, based on responses from economists.

While rates are rising, the increase may not be enough to justify the government forecasts for economic growth.

The Office of Management and Budget predicts yields on 10- year notes will average 4.1 percent in 2015 and 4.9 percent in 2017 as the economy expands at about a 4 percent rate in the second half of President Barack Obama’s term. Bond prices suggest the yield will average below 3 percent two years from now, implying that gross domestic product will fall short of OMB projections, according to data compiled by Bloomberg.

Treasury borrowing costs just above last year’s record lows mean easy credit for consumers and companies as well as sustained demand for riskier assets such as stocks. The record low 10-year rate was 1.38 percent set in July.

“Clearly, the bond market is on one end of the spectrum and these guys are on the other end, believing rates are going to go up so fast,” Priya Misra, the head of U.S. rates strategy at Bank of America Merrill Lynch in New York, another primary dealer, said Feb. 8 in a telephone interview.

“The 10-year yield rising to about 5 percent in four years is too optimistic,” Misra said.