Why Are Bonds Defying Expectations?
The Fed raised rates last month, then bond prices rose. What gives?
Question: I'm confused. I thought bond prices were supposed to fall after the Fed raises rates. Why are they gaining?
Answer: What is going on in the bond market right now is probably a confluence of several factors. First things first: On March 15, in a move that was widely anticipated, the Federal Reserve Open Market Committee raised its target interest rate a quarter point, to a range of 75-100 basis points.