CT3 peak torque is at 6,000 RPM and peak HP is 6,500 RPM. I've never had one that didn't rev freely to 7,000+ in lower gears at least if it was running right.

There is a possibility of "sluggish" gauges... I've seen that more than once. Speedo is easy to verify with GPS app on a phone these days.

What air filter did you use? If foam, what oil? It does sound like you have and intake or exhaust restriction or ignition timing is off as was mentioned.

Double checked mine on test ride yesterday. Yep, in 4th gear mine will rev to 7250rpm and that is with a strongly suspected rich mixture at the top end. With the mixture right, I will be expecting to redline.

So if yours will not rev freely past 5000 in the lower gears, something is wrong.

Post #9 i see you say won't rev past 5k in any gear.
I was thinking only top gear.
That has me still thinking exhaust before anything--well almost anything.
A backed up exhaust give symptoms of a too large main jet that limits out [5k in your case] & won't clear.
Should be taking off & really getting into it in the lower gears at those revs--in my opinion, but i could be getting too one eyed in old age lol.

So it sounds like timing....too big of a main jet(200 it had a 175 but factory manual says 230 so i put in 200?)...how do i clear an exhaust blockage? the baffle has been cleaned...thanks again for all the replies appreciated
 

Yes, timing should be checked. They usually run well if timing is is just somewhat close to correct though.

Don't overlook the air filter. Very common source of this issue in my experience. "New" doesn't mean "correct".

Exhaust blockage is another common cause.

Sounding like a broken record now... hope you figure it out soon.

If your pipe looks like this with the baffles shown, there'll be a spark arresting restrictive part if you look deep in the end with the end piece removed.
The restrictive piece is fixed & non removable & looks like a jet engine sort of angled vanes.
They get blocked in there & can't really see straight through due to the angled parts.
To prove a point, if you removed both those parts shown & went for a ride albeit a very noisy ride, you'll soon know if its improved.
It could need totally burning out in the main pipe but look down in with a light & see how it looks as far in as you can see.
Sorry if i'm a pain & keep going on about exhaust but if you eliminate that then i'll get back in the corner haha.
Mine sounds pretty noisy as i cut the insides out about 40 years ago as had come loose & rattling.
www.yamahapart.com/oemparts/a/yam/500416...0209bc784739/exhaust

I removed the baffle from the exhaust and it looks blocked but im not sure if it should look like that it has a cream coloured centre that you cannot push a wire past.. .i presume that should be there?

Not sure what could be cream colored in your exhaust. Maybe some packing came loose and got stuck in there?

www.yamahapart.com/oemparts/a/yam/500416...0209bc784739/exhaust

Why not just try it with the baffle removed, and see if it runs better?

I would take the air filter out of the air box and go for a ride if there’s no change then your exhaust is probably it 
post a video if possible