Mar 24, 2020 - Economy

U.S. bond yields go negative again as investors seek coronavirus safety

Data: Investing.com; Chart: Axios Visuals
Data: Investing.com; Chart: Axios Visuals

U.S. Treasury yields on one-, two- and three-month maturities all turned negative late Monday, as investors continued to favor short-term debt that functions like cash.

What it means: “What you are seeing today is an example of a flight-to-safety on a massive scale,” Kathy Jones, chief fixed-income strategist at Charles Schwab, told FT on Wednesday when yields first fell below zero.

  • Short-dated Treasury bills are seen as more like cash because they are easier to trade than their longer-dated counterparts, Jones said, adding, “People are desperate for cash.”

The big picture: The U.S. is the first major economy in which government bond yields have turned negative before the country's central bank announced it would enact policy to push them below zero.

Go deeper: Record low U.S. Treasury yields are expected to keep falling

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