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When trillions of dollars in value vanished from stock markets over Donald Trump’s tariffs, the president held firm, however when the bond market showed signs of trouble he made a swift reversal.

“MY POLICIES WILL NEVER CHANGE,” he said last week, as equities tanked. “BE COOL!” he said Wednesday morning, as they fell further — but hours later, he announced he was pausing his “reciprocal” tariffs for 90 days. Why?

The bond market was getting “queasy,” Trump told reporters later Wednesday.

Usually, when the stock market tanks, investors flee to the “safe haven” of Treasuries, causing their prices to rise and yields — or market interest rates — to fall. But late Tuesday into Wednesday, investors were selling stocks and Treasuries, causing price falls in both markets.

“When we see both the stock market and Treasuries have a negative price movement at the same time, this is very rare,” Kathy Yuan, professor of finance at the London School of Economics and Political Science, told CNN. The last time this “worrisome” development happened was during the Covid-19 shock of early 2020. “It cannot be ignored,” she said.

One reason for the Treasury selloff appears to have been a massive unwinding of the “basis trade,” where investors try to profit from the difference between the price of Treasuries and that of Treasury futures. The trade involves investors borrowing huge sums to buy Treasury bonds. The profit margins are small but repeated often enough as to be a huge cash cow for hedge funds.

But a more troubling reason may be that investors did not rush to buy Treasuries like in previous panics.

“When you damage your international relations, the international investors are going to be less likely to buy your assets — and we saw some of that yesterday,” John Canavan, the lead US analyst at Oxford Economics, told CNN.