Falling oil and gas prices -- Bullish or Bearish for bonds?
So which is it? Are lower energy prices bullish or bearish for bonds? The answer RIGHT NOW is apparently bullish. Crude futures dropped yet again, losing $1.81, and the response in the bond market was a rally -- 13/32 recently on the Long Bond future. Will this relationship hold? Is there a point at which these falling energy prices will once again be a negative for bonds? That's a question we don't know the answer to yet.