What Higher Bond Yields Mean for Markets in 2025

Long-term yields spiked after the election.

Dominic Pappalardo, chief multi-asset strategist at Morningstar Investment Management, discusses why long-term yields spiked in the wake of the election, what's next for fixed-income in 2025, and how investors can take advantage of higher yields in their portfolios.

00:43 Why Did Bond Yields Rise in the Wake of the Election?

01:52 How Investors Are Thinking About Rising Bond Yields

03:01 What the Current Run-Up in Bond Yields Tells Us About the Markets

04:36 How Do Today’s Yields Compare to History?

06:18 Will the Flat Yield Curve Start to Steepen?

07:29 How Bond Yields Affect the Stock Market

09:09 How Long Can the Market Withstand a Higher Interest Rate Environment?

09:54 How Bond Yields Affect Mortgages

11:55 How Today’s Bond Yields Can Benefit Investors When Looking at Portfolio Construction

14:34 Economic Outlook 2025 Key Takeaways



Read about topics from this episode.

Postelection Deficit Concerns Fuel Jump in Bond Yields https://www.morningstar.com/bonds/pos...

Trump’s Tariffs: A Wild Card for the Markets in 2025 https://www.morningstar.com/markets/e...

Fed Sticks to Rate Cut Plans, for Now https://www.morningstar.com/stocks/fe...

‘Diversification Is Back’—Why 60/40 Portfolios Are Working https://www.morningstar.com/markets/d...





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