After President Trump's tariff announcement, financial markets fluctuated, spurring a quick response. Bond markets reacted dramatically, with investors seeking safe havens amid fears of recession. The yield on 10-year U.S. Treasury bonds fell significantly, but later, a notable sell-off occurred, leading to higher long-term rates. This sell-off prompted Trump to retreat from proposed tariffs, highlighting the bond market's crucial role in influencing economic policy and its stability as a reflection of investor confidence.
The bond market signaled to President Trump that his tariff plan was unsustainable, leading him to reconsider extreme tariffs after bond yields rose unexpectedly.
Historian Adam Tooze noted that the sell-off in the bond market was one of the largest seen since 1982, reflecting extreme investor anxiety.
Collection
[
|
...
]