Archive · 24 Jul 2025
Trade Optimism Drives Sell-Off of US Bonds
Imagine people were worried about the economy, so they bought safe things like bonds.
Then, good news about trade deals with Japan and possibly the EU made them feel better.
They started buying stocks instead, which are riskier.
This caused the price of safe bonds to go down.
A deal with Japan meant the US would tax some goods less in exchange for Japanese companies investing in the US.
Even though the bond market saw a sell-off, a sale of long-term US bonds did well because people still wanted to buy them.
U.S. Treasury prices fell on Wednesday due to trade deal optimism.
A U.S. trade deal with Japan and a potential deal with the EU spurred investors to sell bonds and buy stocks.
The Japan trade deal included a 15% tariff on shipments to the U.S. in exchange for Japanese investments.
Japanese equities rallied, but Japan's bond markets faced downward pressure.
A U.S. government debt sale of 20-year bonds was well-received despite market concerns.
- Who
- Investors, U.S. and Japanese officials
- What
- U.S. Treasury prices declined due to trade deal optimism.
- When
- Wednesday
- Where
- Global Markets
- Why
- Trade deal optimism prompted investors to sell bonds and buy stocks.
- Trade Deal Participants
- U.S., Japan, EU
- Japan Deal Tariff Rate
- 15%
- Japan Investments
- $550 billion
- 20-year Bond Yield
- 4.935%
- 10-year Yield Increase
- Over five basis points