Bonds
International and Emerging-Market Bonds
Bonds issued outside the United States, by foreign governments and companies, in dollars or in their own currency. The coupon is only part of the return; the exchange rate is the other part.
Data as of Aug 21, 2026.
International bonds split along one line that matters more than any other: the currency they pay in. Hard-currency bonds are issued by a foreign government or company but denominated in US dollars, so a US holder faces credit risk without currency risk. Local-currency bonds pay in the issuer's own money, and your return depends on the exchange rate as much as on the coupon.
The second split is developed versus emerging. A developed-market sovereign is a different credit proposition from a frontier issuer, even though both appear in the same broad category and often in the same fund.
Sovereign credit also works differently from corporate credit. There is no bankruptcy court for a country. A restructuring is a negotiation, governed by the bond's legal jurisdiction and its collective action clauses, and the outcome depends on willingness to pay as much as ability.
If the bond pays in dollars you are taking credit risk only. If it pays in another currency you are taking a view on that currency too — and the currency move can easily be larger than the coupon.
At a glance
Issuer, backing, term and how the cash actually reaches you.
Who issues them
Foreign national governments, their agencies and provinces, supranational institutions such as development banks, and non-US corporations. Some issue into the US market under US law; others issue at home under their own.
What backs them
A sovereign's taxing power and its willingness to pay, or a company's cash flow. The legal jurisdiction is part of the backing: bonds issued under New York or English law behave differently in a restructuring from bonds issued under local law.
Typical maturities
The full curve, from short bills to thirty years and occasionally beyond. Emerging sovereigns concentrate issuance in the 5 to 30 year range in dollars, and shorter in local currency.
How you get paid
Usually a semi-annual coupon. Local-currency bonds pay in that currency and your broker or fund converts, so the dollar amount you receive moves with the exchange rate even when the coupon does not.
What it pays right now
Live series from our rates table, each labelled with what it measures, who published it and when. Index and benchmark levels, not the price of a specific bond.
In text, the series shown below currently read: 10-year Treasury at 4.74%; Investment-grade corporate bonds at 5.43%. These rows are quoted on more than one basis, so they are listed rather than ranked — the Basis column says which convention each one uses. Each row carries the basis it is quoted on and the exact series that supplies it.
Three things to know before you read a number in this table. Each row is a published series, not a bond for sale — several of these are averages across hundreds of bonds, and an average is not a price anyone will fill you at. The Basis column says what each row measures, and rows measured differently are not comparable with one another however close the numbers look. And the Observed column dates the reading: NOT CURRENT means the publisher is overdue and the figure shown is the last one they released, not today's. The note under the table says which rows belong to this category and which are here only as a benchmark to measure it against.
| Series | LatestThe most recent published reading. Percent per year, unless the basis says points. | Change | BasisWhat the number measures. Two rows on different bases cannot be compared. | Provider · series | Observed |
|---|---|---|---|---|---|
| 10-year Treasury | 4.74% | +0.05 pts | Constant-maturity yield | US Treasury via FRED · DGS10 | Aug 21, 2026 |
| Investment-grade corporate bonds | 5.43% | +0.02 pts | Index effective yield | ICE BofA index via FRED · BAMLC0A0CMEY | Aug 21, 2026 |
We do not currently carry foreign sovereign yield series, so nothing here is an international bond yield. These are the two US benchmarks international bonds are measured against: the 10-year constant-maturity Treasury yield (US Treasury via FRED) and the ICE BofA US investment-grade corporate index effective yield (via FRED). Neither is adjusted for currency, and currency is usually the larger part of an unhedged international return.
How the income is taxed
US federal and state treatment. Rules change; this is the structure, not tax advice.
Why this section sits between the rates and the risks rather than at the end: two bonds quoting the same number do not pay you the same amount. Bond interest is generally taxed as ordinary income federally, at your own marginal rate, and what differs between the families is whether your state also taxes it and whether any federal exemption applies. A headline yield is a before-tax figure everywhere on this site, so the comparison that matters to you is the one made after the paragraphs below.
Funds report on Form 1099 and pass through any foreign tax paid, which you may be able to claim as a credit or a deduction. Holding a foreign-bond fund inside an IRA can make that credit unusable.
Currency gains and losses on individual foreign-currency bonds have their own tax treatment separate from the interest, which is one reason most US investors reach these markets through funds rather than directly.
Nothing here is state-tax exempt. The Treasury exemption is a US federal-issuer feature and does not travel.
Funds that hold these
Exchange-traded funds in our universe tagged to this category, sorted by trailing 12-month distribution yield.
5 funds tagged to this category are listed below. Trailing twelve-month distribution yields run from 4.54% on BNDX to 6.13% on EMLC, with a median of 5.83% across the 5 funds that have paid a distribution in the past year. 5 of them pay monthly rather than quarterly. Every figure in that column is trailing cash already paid over the last 365 days divided by the latest price — a distribution yield, not a forward yield, not a yield to maturity and not an SEC 30-day yield.
A fund is how most people end up owning this category, and it is not the same instrument as the bonds inside it. The yield column here counts the cash already paid out over the last year against today's share price, so it describes what has happened rather than what the holdings are contracted to earn — the two can differ by a wide margin in either direction. The other difference is the one people notice late: an individual bond has a date on which it repays, and a fund does not. It keeps selling and rebuying, so there is no maturity to wait for if the price falls.
| Ticker | Fund | HoldsThe kind of bonds the fund lends through. | Price | Distribution yield, trailing 12mCash the fund has already paid out over the past year, divided by today's price. | Cash paid / share, trailing 12m | Pays |
|---|---|---|---|---|---|---|
| EMLC | VanEck J.P. Morgan EM Local Currency Bond ETF | International | $25.91 | 6.13% | $1.59 | Monthly |
| PCY | Invesco Emerging Markets Sovereign Debt ETF | International | $21.16 | 5.94% | $1.26 | Monthly |
| VWOB | Vanguard Emerging Markets Government Bond ETF | International | $66.31 | 5.83% | $3.86 | Monthly |
| EMB | iShares J.P. Morgan USD Emerging Markets Bond ETF | International | $95.38 | 5.11% | $4.87 | Monthly |
| BNDX | Vanguard Total International Bond ETF | International | $47.91 | 4.54% | $2.18 | Monthly |
How it loses money
The specific failure modes for this category, not a generic warning.
Most people arrive at bonds expecting the only question to be whether the borrower pays. The list below is the answer to a different question: the ways the money shrinks while every payment arrives exactly on schedule. Prices fall when new bonds pay more than yours, inflation can outrun a fixed payment, and a borrower who repays early hands the cash back at the worst moment to reinvest it. Read these before the yield, not after it.
- Currency riskFor an unhedged local-currency bond this usually dominates. A currency move can wipe out several years of coupon in a single quarter, in either direction.
- Sovereign default and restructuringCountries restructure. With no bankruptcy court, the process is negotiated, the timetable is political, and holdout creditors have historically litigated for years.
- Capital controls and convertibilityA government under pressure can restrict the movement of money out of the country. The bond may keep paying in local currency that you cannot convert or repatriate.
- A different rate cycleForeign central banks move on their own schedule. Duration risk is still duration risk, but it is driven by a policy rate you are not watching.
- Hedging dragA currency-hedged fund removes the exchange-rate swing at a cost that tracks the short-term interest-rate differential between the two currencies. When that differential is wide, the hedge is expensive and it comes straight out of the yield.
- Liquidity and disclosureTrading is thinner, settlement conventions differ, and financial disclosure standards vary by market.
Where these are traded
The Treasury's direct issuance channel for notes, bonds and TIPS, including non-competitive bids at auction without a broker.
Holdings there cannot be sold before maturity without transferring them to a broker first
Visit TreasuryDirect ↗The Municipal Securities Rulemaking Board's official disclosure site, carrying offering documents, reported trade prices and continuing disclosures for municipal bonds.
Free official source; no account needed
Visit MSRB EMMA ↗The broker-dealer regulator that runs the TRACE trade-reporting system for corporate, agency and municipal bond transactions and publishes market data from it.
Also hosts BrokerCheck for looking up a firm or registered rep
Visit FINRA ↗Runs a retail bond desk with new-issue and secondary inventory across Treasuries, municipals, corporates, agencies and brokered CDs.
Individual bond pricing is quoted net of a dealer markup rather than as a separate commission
Visit Fidelity Investments ↗Listed for reference. No sponsorship badge means no affiliate relationship exists.