Bonds, Interest Rates & Exchange Rates
Why do bond prices fall when interest rates rise?
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When market interest rates rise, newly issued bonds pay higher interest, so bonds already issued at lower rates become less attractive and their prices fall.
Conversely, when rates fall, the relative value of existing bonds rises and their prices go up. That is why bond prices and market interest rates move in opposite directions.
This answer is general financial information as of 2026-10-14, not investment advice. Rules and tax rates change, so please also check the latest guidance from the source institution.
