Investors have fled bank bonds in the past week, worried that the Federal Reserve may hike interest rates this year.

Spreads between yields of bank bonds and those of Treasuries started to widen after last Friday's Labor Department report that consumer prices jumped 0.7% in April-a sign of inflation. The widening accelerated Tuesday when the Fed's Open Market Committee changed its "bias" to a tightening stance from a neutral one.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.