Definition ∞ A bond yield spike signifies a rapid and substantial increase in the interest rate a bond pays relative to its market price. Such a movement indicates a decreased demand for bonds, often driven by expectations of rising inflation or central bank policy shifts. Higher yields typically signal a reallocation of capital away from fixed-income securities. This can influence broader financial markets.
Context ∞ A bond yield spike can exert pressure on digital asset valuations, as investors may seek less risky, higher-yielding traditional assets. This phenomenon often prompts discussions about capital flows between conventional finance and cryptocurrency markets. Monitoring bond yields offers insight into macroeconomic conditions affecting digital asset sentiment.
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