Yellen Says Surge In Bond Yields Is Happening In Most Advanced Countries, Not Indicator Of Recession; Says Part Of Increase In Yields Is A Reflection Of Expectations That Interest Rates Will Be Higher For Longer
Portfolio Pulse from Benzinga Newsdesk
Janet Yellen, the U.S. Treasury Secretary, has stated that the recent surge in bond yields is occurring in most advanced countries and is not an indicator of a recession. She also mentioned that part of the increase in yields is a reflection of expectations that interest rates will be higher for longer.
October 26, 2023 | 5:41 pm
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NEGATIVE IMPACT
The surge in bond yields, as mentioned by Yellen, could impact the SPY ETF. Higher bond yields can make equities less attractive, potentially leading to a decrease in the ETF's value.
The SPY ETF tracks the S&P 500, which is sensitive to changes in bond yields. Higher bond yields can make equities less attractive as they increase the cost of borrowing, potentially leading to a decrease in the ETF's value. However, Yellen's comments also suggest that this is not an indicator of a recession, which may mitigate some of the potential negative impact.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 50