Home›Crypto›Market Structure›Treasury and equity correlation hits record lows, pres…

Treasury and equity correlation hits record lows, pressuring Bitcoin

UBS estimates the two-month rolling correlation between the S&P 500 and the 10-year Treasury yield at -0.69, its lowest since 1996, as bond safety shifts into risk for investors.

Reported · Written up by our desk · Market Structure

CryptoSlate argues that for decades American investors relied on a portfolio “insurance” relationship, where falling equities coincided with rising Treasuries, helping offset losses. That dynamic, built into products and allocation habits, has started to reverse.

According to UBS, the two-month rolling correlation between the S&P 500 and the 10-year Treasury yield is -0.69, the lowest reading since 1996. CryptoSlate says this implies stocks and bonds are moving together more than they have in about thirty years, and the asset once viewed as an offset to equity weakness is now contributing to selloffs.

The piece attributes the shift to changing drivers of the market, not simply a loss of faith in Treasuries. It notes that investors still want bond safety but increasingly want it without duration exposure, and it points to research from AQR that inflation volatility and whether markets are reacting to growth news versus inflation news explain much of the long term behavior, around 70%.

CryptoSlate also highlights inflation’s extended role since 2022, saying cooling inflation prints have not altered the core problem because volatility matters more than single readings. It adds that the 30-year Treasury yield crossed 5% for the first time since 2007, spent much of 2026 above that level, and is currently near that threshold, a backdrop it links to the pressure on Bitcoin.

Latest closeBitcoin $64,066.50 ▼1.0%|S&P 500 7,533.77 ▼0.5%

More like this

Sources