Treasury Market’s Weaknesses Are Laid Bare Under Strains of War
- Several gauges are showing deterioration in trading conditions
- Challenges could rise when Fed starts shrinking bond portfolio
The U.S. Treasury building in Washington.
Photographer: Samuel Corum/BloombergThis article is for subscribers only.
The rush into Treasuries sparked by Russia’s war in Ukraine has exposed fresh signs of weakness in the world’s biggest bond market, adding to pressure on U.S. regulators to detail a reform plan.
The latest indications of poor trading conditions include a deterioration in the ability to buy or sell a security without moving its price, market participants say. There’s also a slump in the volume of trading of non-benchmark Treasuries, according to Bloomberg Intelligence.