Sovereign Bond Yield Curve & Sell-Off Dynamics Workbench

Dynamic Yield Curve Canvas (3M to 30Y) ● Baseline ● Scenario / Drag Nodes

Fiscal Issuance Shock (Term Premium) +45 bps

Inflation Expectation Shock (Breakeven) +30 bps

Central Bank Policy Path (Short End) +15 bps

Duration Risk Multiplier (Custom) 7.8 yrs

10Y Yield Decomposition Waterfall Δ +90 bps

1. Baseline Real Policy Anchor

2.40%

2. Inflation Risk Premium

2.15%

3. Fiscal Supply Term Premium

1.00%

Active 10Y Sovereign Yield

5.55%

Portfolio Price & Convexity Drawdown

Tenor Bucket	Mod. Duration	Yield Δ	Est. P&L Loss
2Y Short Note	1.9 yrs	+25 bps	-0.47%
10Y Benchmark	8.2 yrs	+90 bps	-7.12%
30Y Ultra-Long	18.4 yrs	+120 bps	-19.85%
Target Portfolio	7.8 yrs	+90 bps	-6.78%

Macro Sell-Off Insight: Heavy sovereign deficit financing triggers an abrupt supply-demand mismatch. Investors demand a higher term premium to hold long duration bonds, forcing the yield curve into a classic Bear Steepener and generating severe capital losses on long-dated paper.