The 30-year US Treasury yield reached approximately 5.28% in July, a level not seen in nearly three decades. The ICE BofA MOVE Index, which tracks Treasury volatility, stands near 71-73, far exceeding typical investor expectations. Rebecca Patterson, senior fellow at the Council on Foreign Relations, warns of a breakdown in the traditional stock-bond correlation, stripping diversified portfolios of their usual protection. Investors holding long-duration bond funds face substantial losses if yields continue climbing, with capital losses potentially erasing years of coupon payments.
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