Goldman Sachs is calling a top for U.S. Treasuries because the firm’s analysts believe inflation and interest-rate hike expectations have been overdone for U.S. government bonds.

“At 3.70 percent, 10-year Treasuries are at the top end of the trading range,” Goldman said in a recent report. “Our Sudoku model suggests that based on consensus expectations for growth, inflation and policy rates, 10-year yields should trade at around 3.50 percent.”

“If we were to plug our below-consensus macro forecasts, Sudoku would put the fair value closer to 3.0 percent.”

In fact, Goldman appears to expect inflation will rapidly fall to very low levels.

“We continue to expect disinflation in core consumer prices,” the firm notes. “We have argued for quite some time that core inflation has been sticky up until January because of two temporary inflationary forces — tobacco and car prices,” two factors that alone were responsible to nearly half of a recent year-on-year reading in core inflation.

Tobacco prices rose more than 30 percent last year, as local governments raised taxes in order to make up for their budget shortfalls, and vehicle prices have risen steeply largely because car dealers are now selling their new car inventory at normal prices.

Treasuries recently rose on speculation demonstrations in Greece will make it tougher for the government to cut the European Union’s biggest budget deficit, increasing demand for the relative safety of U.S. securities, Business Week reports.