American Homeowners Are Adding Fuel to Bond Market Sell-Off
- MBS investors protecting portfolios exacerbating rate move
- Higher yields have knock-on effect on stocks, credit and more
Photographer: Roger Kisby/Bloomberg
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There comes a point in any big selloff in Treasury bonds when the move becomes so pronounced that it starts to feed on itself. Increases in yields force a crucial group of investors to sell Treasuries, which in turn leads to further increases in yields.
Two months into this rout, that moment appears to have arrived, and it’s beginning to send shudders throughout all corners of U.S. financial markets.