U.S. government bonds and related ETFs climbed Tuesday, with a key yield curve inverting to its worst level in over a decade, as equity markets retreated and investors turned to safety plays in response to the renewed risk-off sentiment.

Among the best performers on Tuesday, the PIMCO 25+ Year Zero Coupon US Treasury Index ETF (NYSEArca: ZROZ) advanced 2.6%, Vanguard Extended Duration Treasury ETF (NYSEARCA: EDV) gained 2.2% and iShares 20+ Year Treasury Bond ETF (NASDAQ: TLT) increased 1.5%.

Yields on 30-year Treasury notes slipped to 1.95%. Meanwhile, the yield on 10-year Treasuries were at 1.47% while yields on 3-month notes were at 1.97%.

The worsening inversion is “certainly validating that a recession has a great chance of being here a year, year and a half from now,” Kevin Giddis, head of fixed income capital markets at Raymond James, told CNBC.

Most of the market’s angst is a function of “what investors think the Fed’s going to do and the delay in the U.S.-China trade agreement,” Giddis added.

The last time the markets saw an inversion of this part of the yield curve was the one that began in December 2005, or two years prior to the financial crisis and subsequent recession. A yield curve inversion has historically preceded an economic recession.

The volatile swings in stocks have been largely driven by developments in the protracted U.S.-China trade war. The heightened risk has raised demand for Treasuries, revealing the growing concerns among bond investors over the economic outlook.

While stock investors focus on U.S. and China officials, “the data overseas continues to be poor; we’ve got a global manufacturing recession; Germany is probably going to enter into a technical recession; the U.K. has Brexit coming up; China is slowing; and our view is that the corporate sector here is showing signs of slowing, which will end up eroding jobs,” John Briggs, head of strategy for Americas at NatWest Markets, told the Wall Street Journal.

For more information on the fixed-income market, visit our bond ETFs category.

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