Please stay tuned for important disclosure information at the conclusion of this episode.

Welcome to Investing Insights. I'm your host, Ivana Hampton. The bond market is jittery. A higher for longer environment for interest rates is persisting. A recent U.S. government bond sell

off rippled across the world. None of this is making bond investors happy. But what if there's

some good news? Morningstar columnist Dan Lefkowitz believes there is. The Morningstar indexed

strategist joined investing insights to explain why it's time to look to the positive.

Thanks for being here, Dan.

Thanks so much for having me.

Well, let's start with how the bond market is looking so far in Q1.

We're going to timestamp this February 20th.

Yeah.

So things have sort of settled down in February, but we did have a bond market sell-off in January.

The start of the year, the yield on the 10-year Treasury was 4.5.

And the first couple weeks of the year, it got pushed to 4.8.

So we saw the bond market, you know, existing bonds lose their value, the Morningstar U.S.

core bond index, which represents kind of the investment grade, bond universe, treasuries,

corporates, agencies declined about 1% just in a couple weeks.

Now, like I said, February, things are sort of moderated and that yield on the 10-year

treasury is back down to 4.5.

Our core bond index is now in positive territory for the year, but only slightly.

The Federal Reserve cut interest rates three times in the final months of 2024.

But the 10-year U.S. Treasury were yielded, went up, set it down.

That probably surprised some folks. Definitely.

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