Bond Market’s ‘Extreme’ Short Counts on Fed to Deliver Hike
Bond traders have significantly increased bearish positions ahead of the Federal Reserve’s upcoming policy meeting, anticipating that a potential interest rate hike will drive Treasury yields further into two-decade highs. This surge in short positions reflects a widespread market expectation that the recent selloff in government debt will continue. While some analysts argue a case for an eventual bond rally and declining yields, current sentiment remains heavily skewed toward a hawkish central bank outcome.
Bond traders have piled into bearish positions ahead of Wednesday’s Federal Reserve meeting, betting that the Treasury selloff driving yields to their highest in almost two decades will continue. Steven Major, Global Macro Advisor at Tradition, discusses the case for a bond rally and falling yields. (Source: Bloomberg)
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