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Bond Traders Swarm 2019 Fed-Hike Bets After Inflation Surprise

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Eaton Vance's Stein Sees Higher Treasury Yields, Weaker Dollar

Bond traders, seeking a way to bet on more Federal Reserve rate hikes, are setting their sights on 2019.

After a Wednesday report showed consumer prices rose in January by more than projected, traders used eurodollar futures to express their view that central bankers have a clearer path to tighten. The expected number of increases from now until the end of next year is up to four, from 3.6 before the inflation report. In contrast, the odds of a move in March haven’t changed much, rising to about 90 percent from around 85 percent ahead of the data.