The Quiet Fall in Bond Yields

Daniel Kelley |

The Quiet Fall in Bond Yields
What’s behind the quiet fall in bond yields?

Provided by Kevin Guarino


With all the attention given to inflation, stock prices, and job reports, it’s been easy to overlook the remarkable move in the bond market during the past few months.

The yield on the 10-year treasury closed at 1.37% on Friday, July 9, down from its 2021 high of 1.74% in late March.1

What’s behind the quiet fall in bond yields? 

One explanation may be that reopening sentiment has turned a bit more cautious as the Delta variant of COVID-19 spreads globally. Another view is that overseas investors are buying Treasuries, effectively lowering yields.2,3

Still another school of thought says it's due to declining inflation concerns. Or maybe it's simply more money finding its way into bonds.2

Whatever the cause, the yield narrative has changed from just a few months ago when market pundits believed that the 10-year treasury was heading to 2%.1

Will yields keep trending lower or will they do an about face and move higher? A better question to ask yourself is, “does my investment strategy fit my goals, time horizon and risk appetite?” Challenge yourself to tune out the market noise and focus on what matters to you.

Check out these other Investing Education blogs
Investing During Periods of Inflation
Financial Strategies for Young Families


Kevin Guarino may be reached at 585-899-3940 or

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

The market value of a bond will fluctuate with changes in interest rates. As rates rise, the value of existing bonds typically falls. If an investor sells a bond before maturity, it may be worth more or less than the initial purchase price. By holding a bond to maturity, an investor will receive the interest payments due plus your original principal, barring default by the issuer. Investments seeking to achieve higher yields also involve a higher degree of risk.

Securities and Advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC. Additional advisory services offered through Clover Leaf Financial, a registered investment advisor and separate entity from LPL Financial.

1. U.S. Department of Treasury, July 12, 2021

2., July 8, 2021
3. The Wall Street Journal, June 11, 2021

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