The 30-year bond, one of the safest securities the Treasury market has to offer, is getting crushed via a selloff over the past two weeks that’s drawn comparisons to the losses seen in U.S. equities during the dot-com bust and the 2007-2009 financial crisis.
Read: Wall Street worries U.S. could lose last AAA rating as political chaos fuels government-shutdown fears The central bank has “the ability to hold until maturity and the only thing that could change this would be if inflation becomes very, very problematic and maybe leads to another wave of trying to control the situation and expectations” — prompting bond sales similar to what the Bank of England is doing now, Emons said via phone on Thursday.
While the post-pandemic period has ushered in a period of inflation and higher rates — producing lower prices on existing Treasury bonds — “it has also provided a potential opportunity to invest in Treasuries with much more attractive return potential,” Martinez said.
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