What happens to the appraised value of a bond when the interest rates rise?

When interest rates rise, the appraised value of a bond declines due to the inverse relationship between bond prices and interest rates. A bond's fixed interest payments become less attractive when new bonds are issued at higher interest rates, leading investors to demand a higher yield on existing bonds to compensate for the lower coupon payments. This increased demand for yield causes the market value of existing bonds to fall, resulting in a decline in their appraised value. Therefore, as interest rates go up, the existing bonds that have lower interest payments end up being worth less in the market.