President Donald Trump’s tariff move triggered a mass sell-off of US government bonds, traditionally seen as safe-haven investments
Confidence in the US economy is weakening as demand for government bonds plummeted this week.
Bonds are seen as one of the world’s safest financial assets. The government sells bonds (that can be called debt) and repays bondholders along with interest (yield). Typically, the interest rates on the debt are not high.
However, on Wednesday, the 10-year bond yield surged to 4.5%—the highest level since February—due to President Donald Trump’s tariffs.
Tuesday’s Treasury auction of the 3-year notes saw the lowest demand since December 2023, causing a dramatic bond sell-off.
A $39 billion US bond auction later stabilized markets slightly, but analysts warned of lasting volatility.
