Volatility Returns to the Treasury Market 🌤️ The Morning Print
Good morning!
The MOVE Index was up 21% yesterday, its largest single-day increase since October 7, 2024.
Let's take a look.
The MOVE Index is the bond market’s version of the VIX.
Yesterday’s increase signals a sharp rise in expected volatility in U.S. Treasury yields, suggesting the bond market is bracing for larger swings in interest rates.
Investors are rapidly repricing uncertainty around the path of policy rates and the broader economic outlook.
While a single-day spike doesn’t necessarily signal a sustained shift, elevated rate volatility can tighten financial conditions and eventually spill over into stocks.
In other words, what happens in the bond market rarely stays in the bond market.
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