Bond markets reacted to the announcement of high fiscal deficit and resultant spike in borrowing by the central government in Union Budget 2021 with a surge in yields. The benchmark 10-year security's yield moved up to 6.12 percent on February 2, 2021, up from 5.93 percent on January 28, 2021. When the bond yields go up, bond prices fall. Long-term bonds are more sensitive to bond yield movements. Rise in yields in a short span can lead to losses to bond fund investors as well. Long duration bond funds, which invest in bond portfolios with more than seven years duration, have lost 1.68 percent in one month ended February 12, 2021. Short duration bond funds lost 0.44 percent.