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Opinion
Brian Chappatta

U.S. Treasuries Are Not Supposed to Trade Like This

Thirty-year bonds typically reflect structural forces that don’t just change overnight. That thinking may no longer hold.

Long-bond yields swung 85 basis points in two days. Then 63 more.

Long-bond yields swung 85 basis points in two days. Then 63 more.

Photographer: Robin van Lonkhuijsen/AFP/Getty Images

In a week that has already been record-setting in financial markets by any number of measures, the moves in the 30-year U.S. Treasury bond stand alone as jaw-dropping and unprecedented.

On Monday, the long bond opened at a yield of 0.99%, down 30 basis points from where it closed the last trading session and the first time ever it fell below 1%. About seven hours later, a relentless rally would push the yield to as low as 0.6987%, a drop of 59 basis points that Bloomberg News’s Elizabeth Stanton noted was the largest intraday drop on record. During U.S. trading, as equity markets plunged more than 7%, the yield gradually pared back that drastic move, ending where it started at about 1%.