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Bond Traders Stare at Worst Real Returns Since Volcker Era

  • Treasury returns trail CPI by most since the early 1980s
  • Negative real yields help government at expense of savers
Biden's Economic Plan At Risk Of Delays Amid Democratic Rifts
Photographer: Stefani Reynolds/Bloomberg
Updated on

Treasury investors are losing more money than they have in four decades, once inflation is taken into account. And if markets are right, they’re unlikely to come out ahead for years. 

The federal government’s debt has already lost about 2% outright over the past year as the Federal Reserve started removing pandemic-era stimulus from the economy and inched closer toward raising interest rates. But on top of that, the consumer price index has surged 6.8%, putting investors even deeper in the hole.