Ahead of the Federal Reserve’s anticipated rate cut, bond yields are experiencing a concerning upward trend. This unexpected surge signals market uncertainty and skepticism regarding the efficacy of these rate changes in combating inflation or preventing a recession. 2024 saw bond yields plummet by 16% before the Fed’s first rate cut, with investors anticipating lower rates leading to economic growth. Conversely, in 2025, bond yields are rising at a rate of 5%, a stark contrast to investor expectations. This increase coincides with a surge in bond selling, indicating increased demand for higher returns to offset the rising costs of borrowing. Consequently, long-term financing becomes more expensive, impacting businesses, governments, and households alike. The bond market’s reaction suggests a bearish outlook that is far from convinced by the Fed’s promises of easing economic pressure. This behavior exposes institutional investors’ skepticism about the Fed’s ability to control inflation or prevent a recession.