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WHITE PAPER

22 JUN 2020

Bond Trading: Setting Recent Volatility into Context

Owain Johnson, Global head of research and product development

  • 22 Jun 2020
  • By Owain Johnson

The US Treasury bond complex experienced extremely high levels of volatility in March 2020 as the consequences of the COVID-19 virus impacted the United States and global economies.

In terms of outright bond prices, observed intraday volatility was the highest in recent years, although intraday moves were not generally as large as those seen during the financial crisis when measured in yield terms. This white paper takes an in-depth look at the impact on cost to trade given the significant volatility, and explores how quickly the bond market moved back into its normal trading range, despite ongoing uncertainty around the economic impact of COVID-19.