Bonds Trends After Fed’s Interest Rate Peak

The ebb and flow of the bond market is closely tied to the Federal Reserve’s interest rate decisions. Our exploration begins with a historical understanding of bond movements in relation to these peaks.

Graph 1: Historical Federal Reserve Rate Peaks with Identified Peaks

This graph illustrates approximately 14 peaks since 1955, marking periods of Federal Reserve monetary tightening. These peaks serve as beacons, signaling major policy shifts that bear implications for the bond market’s performance.

Moving from the historical rate peaks, we delve into the bond market’s reaction, particularly focusing on different types of bonds like Treasury, Corporate, and High Yield Bonds.