Is Investing in Treasury Bonds Still Low Risk? Bank of America Strategist Weighs In

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Jun 15, 2025

Meghan Swiber, a Senior U.S. rates strategist at Bank of America, discusses the evolving landscape of the U.S. Treasury market. She explains why long-term Treasury bond yields have risen recently, raising concerns about their perceived safety. Swiber offers insights on navigating volatility in assets typically viewed as low-risk and how inflation affects investor demand. Additionally, she emphasizes the implications of these shifts for portfolios during times of economic uncertainty, providing a nuanced view of Treasury securities today.

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INSIGHT

Rising Treasury Market Volatility

Treasury market volatility is notably elevated, driven by changing investor risk appetites and market functioning challenges.
Treasury yields and demand patterns reveal shifting macroeconomic concerns and risk perceptions among global investors.

INSIGHT

Changing Foreign Demand for Treasuries

Foreign investors, holding about a third of U.S. Treasuries, are reconsidering their allocations amid ongoing large deficits.
Weak U.S. dollar and rising deficits heighten concerns about Treasury market dynamics and its global role.

INSIGHT

Shifting Asset Correlations Challenge Diversification

Traditional negative correlations between U.S. Treasuries, stocks, and the dollar are shifting, complicating portfolio diversification.
Investors question if current trends represent a lasting change or if pre-April asset relationships will return.

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On WSJ’s Take On the Week, co-hosts Telis Demos and Gunjan Banerji start the show by explaining how financial trading platform Robinhood’s stock may tell investors what they need to know about the markets right now. They discuss how company’s CEO, Vlad Tenev, recently visited the White House to discuss “MAGA Accounts,” President Trump’s proposal for a new tax-preferred savings account for children. Plus, with the Federal Reserve’s next interest-rate decision coming this week, the hosts share how tariffs may play a role in the question of when to cut rates.

Later on the show, Meghan Swiber, senior U.S. rates strategist at Bank of America's investment banking arm BofA Securities, shares the latest happenings with the world’s largest bond market, the U.S. Treasury. Long-term Treasury bond yields have risen in recent months, raising concerns that U.S. or international investors are backing away from assets that are usually considered risk-free. She explains what’s going on, and how investors should think about volatility in what usually feels like a placid part of the market.

This is WSJ’s Take On the Week where co-hosts Gunjan Banerji, lead writer for Live Markets, and Telis Demos, Heard on the Street’s banking and money columnist, cut through the noise and dive into markets, the economy and finance—the big trades, key players and business news ahead.

Have an idea for a future guest or episode? How can we better help you take on the week? We’d love to hear from you. Email the show at takeontheweek@wsj.com.

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