US Treasury Volatility Surges to Nine-Month High, 'Fear Index' Jumps to Highest Level Since June Last Year

BlockBeats News, March 13: The US Market Volatility Soars to Nine-Month High, Driven by Iran War Escalation Fueling Inflation Worries and Upending Traders' Expectations for the Fed Policy Path.

The ICE BofA MOVE Index (often referred to as the "fear index" of the bond market) climbed to its highest level since June last year, as rising oil prices intensified inflation concerns, eroding real returns on US Treasuries and weakening their safe-haven appeal.

Both US President Trump and Iran have shown provocative stances in the war, bringing uncertainty to the duration of the conflict. The 30-year US Treasury yield, sensitive to inflation and government spending dynamics, has risen to the highest level in a month, while traders have reduced bets on any rate cuts by the Fed in 2026.

Jack McIntyre, portfolio manager at Brandywine Global Investment Management, said: "As bond investors, we must start thinking from a stagflation perspective, which always brings significant uncertainty. Therefore, from a volatility perspective, I need to be compensated."