Gold rally driven by countries 'starting to give hesitance' in owning U.S. treasuries: CIO
Portfolio Pulse from
Countries are selling U.S. treasuries, leading to a rise in bond yields, which could negatively impact the U.S. economy and equity markets.
February 13, 2025 | 1:45 pm
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NEGATIVE IMPACT
Rising bond yields due to the selling of U.S. treasuries could negatively impact the SPDR S&P 500 ETF Trust (SPY) as equity markets may face pressure.
The increase in bond yields can lead to higher borrowing costs and reduced corporate profits, which may negatively affect equity markets, including SPY, an ETF that tracks the S&P 500 index.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
The selling of U.S. treasuries by countries is likely to impact the iShares 20+ Year Treasury Bond ETF (TLT) as bond yields rise.
As countries sell U.S. treasuries, bond yields are expected to rise, which typically leads to a decrease in bond prices. TLT, which tracks long-term U.S. treasuries, is likely to be negatively impacted as its value is inversely related to bond yields.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80