Bond traders who struggled to predict how high the Federal Reserve would raise interest rates are finding the way down just as vexing.
A major rally in the $27 trillion Treasury market is laying bare anxiety that the US economy is sliding into recession and the Federal Reserve will need to start aggressively cutting interest rates.
It took much of the first half of the year for Treasury bond investors to fall in line with a Federal Reserve signaling higher-for-longer interest rates. Now, as they weigh the timing of a second-half pivot, they must also contend with potential wild-card risks from a hotly contested presidential race.
This week, the US bond market faces its own Super Tuesday of sorts: the release of fresh inflation data investors will use to predict when the Federal Reserve will start cutting interest rates.
Jerome Powell delivered a clear message to traders eager for the central bank to start slashing interest rates: Not so fast.
Bond traders are growing more convinced that US yields are heading lower as they bet on a series of Federal Reserve interest-rate cuts, yet the path to cheaper borrowing costs is set to be extremely bumpy.
Bond traders shrugged off higher-than-anticipated inflation readings for December, pricing in a larger total amount of Federal Reserve interest-rate cuts this year beginning in May.
US stock and bond prices will see modest gains as the Federal Reserve pivots to cutting interest rates next year, though the easing may not be as aggressive as markets are now expecting.
The bond market’s bold bet on US interest-rate cuts is set for its biggest test yet.
A torrid bond market rally shows traders are convinced the Federal Reserve’s rate-rising cycle is over. The debate now turns to when central bankers start cutting, and by how much.
It’s the buzz word on Wall Street and in the hallways of the Federal Reserve and Treasury Department. It’s blamed for triggering bond selloffs, shifts in debt auctions and interest-rate policy.
A prospect that might have seemed unthinkable just a couple short weeks ago is coming into view for bond traders: The potential for US Treasuries to post an annual gain for the first time since 2020.
The selloff in US debt appears close to being over as the Federal Reserve nears winding up its most aggressive rate hikes in a generation.
Bond investors are coalescing around a segment of the Treasuries market that offers a measure of protection from this year’s brutal rout and also positions them for the recession that some still anticipate.
Bond traders are bracing for Treasury yields to keep pushing higher after the Federal Reserve signaled it’s likely to hold interest rates at lofty levels well into next year.
US five- and 10-year yields rose to the highest levels since 2007 after hotter-than-anticipated inflation data in Canada and rising oil prices added to global concerns about resurgent price pressures.
Federal Reserve policymakers’ updated forecasts for their benchmark interest rate, due Wednesday, are looming as a key potential decider for a US Treasuries market at risk of a third straight year of losses.
Jerome Powell has the bond market exactly where he wants it: lacking conviction as to the Federal Reserve’s next steps.
Across Wall Street, there’s growing relief that the Federal Reserve — at long last — may be done raising interest rates. But that doesn’t mean turbulence in the bond market will soon become a thing of the past.
Federal Reserve Chair Jerome Powell on Wednesday appeared to give traders the positive signal they’ve been waiting for — that the central bank may finally be wrapping up its steepest interest-rate hikes since the early 1980s.
Listen to Wall Street’s top economists and you’ll hear the same message again and again: The risk of a recession is fading fast. And yet, in the bond market, the traditional warning that a downturn is near — an inversion of the yield curve — keeps getting louder.
The barrage of fresh Treasury bills poised to hit the market over the next few months is merely a prelude to what’s yet to come: a wave of longer-term debt sales that are seen driving bond yields even higher.
The risks for bond investors from next week’s Federal Reserve meeting go well beyond whether officials decide to raise interest rates again.
Two years after inflation surged, the Federal Reserve has made limited progress tamping it down. A coterie of investors in the bond market is betting not only that policymakers will win, but that they’re right in anticipating the era of low long-term interest rates will return.
The world’s biggest bond market got the ammo it needed from a below-forecast consumer price figure to fully lock in a Federal Reserve downshift in their policy-rate tightening pace, though not enough to wave an all clear sign for Treasuries.
All bets appear to be off on how high yields can rise in the world’s biggest bond market.
Wall Street money managers looking to pile back into Treasuries after months of losses will have to contend with a Federal Reserve that stands ready to raise the stakes every step of the way.
The specter of US interest rates at 4% or even higher is bringing into sharper focus the question of when and how investors should really get back into bonds after Treasury markets suffered one of their worst beatings in decades.
Investors who might be looking for the world’s biggest bond market to rally back soon from its worst losses in decades appear doomed to disappointment.
The spreading global bond rout is spurring a Wall Street debate on whether investors will demand to be paid for lending to the American government like they used to.
Bond traders suspect the Federal Reserve will quickly discover it’s being too ambitious with its newly hawkish stance.
