SHORT ANSWER
The core idea
Central banks influence bond yields through policy rates, expected future policy, asset purchases, balance-sheet runoff, liquidity facilities and communication.
THE MECHANISM
What is happening underneath
The strongest direct influence is usually at short maturities, while longer yields also incorporate inflation, growth and term premium.
MARKET INTERPRETATION
How investors should read it
Credibility matters because markets price what they believe a central bank will do, not only what it announces today.
BONDSTATS TAKEAWAY
The same market move can carry different information depending on which maturity, issuer and risk premium is changing. Read the question together with the underlying concepts rather than treating one price move as a universal signal.
RELATED CONCEPTS
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