The spike in Treasury yields since the middle of March has put a dent in bond exchange traded funds (ETFs) as investors worry about inflation and the budget gridlock in Washington.

Yields on the 10-year note have jumped to about 3.6% after dropping below 3.2% last month. Bond prices and yields move in opposite directions.

The action in Treasury markets has weighed on ETFs such as the roughly $3 billion iShares Barclays 20+ Year Treasury Bond Fund (NYSEArca: TLT).

The ETF weakened in Thursday’s premarket to nearly $90 a share and was down nearly 2% for the week ended April 6, according to Morningstar.

The possibility of a government shutdown is triggering concerns over U.S. debt. [Treasury ETFs Pressured As Budget Deadline Looms.]

With more investors turning bearish on Treasury bonds, ETF providers are rolling out products designed to profit from higher rates. [ProShares Launches Inverse Treasury ETFs.]

iShares Barclays 20+ Year Treasury

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.