There is an inverse relationship between a bond's price and market interest rates (yield). When market interest rates increase, newly issued bonds will offer a higher yield. Consequently, existing bonds with lower, fixed coupon rates become less attractive to investors. For these existing bonds to remain competitive and sell in the secondary market, their prices must drop so that their yield to maturity (which moves in the opposite direction of the price) increases to match the new, higher market interest rates. Therefore, the bond's price will decrease and its yield will increase.