Jerome Powell says Fed will let bond market volatility ‘play out’ amid historic Treasury collapse

• The Fed will let the bond market volatility “play out,” Chairman Jerome Powell said. 
• Rising yields have helped constrain financial conditions, he said at the Economic Club of New York.
• Though there could be many explanations for higher yields, monetary policy forecasts aren’t the main driver.

There could be several factors sending Treasury yields higher, and the Federal Reserve will let the bond market run its course, Chairman Jerome Powell said on Thursday. 

The comments come as the collapse in Treasury bonds since 2020 now ranks among the worst market crashes in history, with the 10-year yield approaching 5% for the first time since 2007.