How falling bond yields are both good and bad for the economy

Tracey Samuelson Dec 20, 2018
Share Now on:
HTML EMBED:
COPY

How falling bond yields are both good and bad for the economy

Tracey Samuelson Dec 20, 2018
Share Now on:
HTML EMBED:
COPY

Thursday saw another big stock market sell-off.  The Dow Jones Industrial Average slumped 464 points, or 1.9 percent. The Dow is off 10 percent for December, and the Nasdaq is down more than 19 percent since Aug. 29. The bond market has been heading in the opposite direction these last few weeks, as increased investor interest in bonds has been driving prices up and therefore sending yields down. That’s how it works, remember: When bond prices rise, yields fall. The yield on the 10-year Treasury finished today almost a half percent lower than its recent October peak. What do the bond markets tell us about how investors are feeling about the economy?

Click the audio player above to hear the full story.

As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.

Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.

Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.