Part 4/7:
Typically, in times of economic downturn, investors might retreat to safer assets like US Treasuries. Yet, recent changes in the bond market present a stark contrast to this usual behavior. Recently, the ten-year Treasury yield experienced its largest weekly gain since 2001, indicating that bond prices are falling alongside increasing yields.
This shift in bond market behavior illustrates a growing unease among investors regarding the U.S.'s safe-haven status. The historically revered US dollar is now in a precarious position in light of rising bond yields, which are contrary to expectations in a world filled with economic uncertainty. This has led to concerns reminiscent of the "bond vigilantes" era, where rising yields may signal trepidation about government fiscal health.