Brian Chappatta, Columnist

Gundlach's Line in the Sand for Bonds Looks Far Away

It's becoming trendy again to say that U.S. yields have peaked for the year.

June 29, 2018 at 11:30 AM UTC

Brian Chappatta is managing editor of Bloomberg News' leveraged finance and distressed debt teams. He was previously managing editor and team leader of its wealth group. Before that he was a Bloomberg Opinion markets and finance columnist and a bonds reporter for Bloomberg News.

Objects are farther away than they appear.
Photographer: Paul Kane/Getty Images

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The world’s biggest bond market is signaling that there are some lines it simply will not cross.

As the first half of 2018 comes to a close, the 30-year U.S. Treasury yield is settling in below 3 percent. It’s hugging its 200-day moving average and has remained range-bound for weeks. Since closing once above 3.22 percent, it’s never done so again, thereby failing DoubleLine Capital Chief Investment Officer Jeffrey Gundlach’s test of whether the bond bull market is dead. That threshold, while still only 0.25 percentage point away, feels far more distant than that.