Nasdaq falls for a fourth straight day as Wall Street frets over potential of higher interest rates

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Rexon Capital joined discussion · Oct 5, 2023 10:21

Why is bond yield increasing?

$Cboe Interest Rate 10 Year T Note(.TNX.US)$

Interesting Fact: When bond price drop, bond yield increases

Looking at how 2y and 10y treasuries are moving, you might be wondering why are the yields rising when there is a good economic data?

The reason is because bond traders are selling their existing bonds (Example: 4% yield) and anticipating that the Fed will do another interest rate hike. If the Fed hikes, these bond traders will get a chance to buy a higher yield bond (Example: 4.5% yield).

Hope you learnt something new!

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