Nora Carol Photography/ Getty Images; Illustration by Austin Courregé/Bankrate
Interest rate hikes by the Federal Reserve have pushed bond yields near levels not seen in more than a decade. With the Fed possibly coming to the end of rate increases, should investors be looking to increase their bond exposure?
How long will high rates last?
For most of the past 15 years, interest rates have hovered near historical lows. The Fed cut interest rates following the 2008 financial crisis and inflation remained muted, which allowed the Fed to keep rates at low levels.
When the Covid-19 pandemic hit the economy in March 2020, the Fed again followed a similar playbook: cut interest rates to stimulate the economy. By August 2020, the 10-year Treasury yield sat close to 0.50 percent.
But as the economy recovered from the pandemic shock, inflation also picked up steam. By March 2022, when the Fed first began…
