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Treasury Market’s Bears Are Set for a Reality Check From Fed

  • Investors going short notes, bonds as they see yields rising
  • Money-market moving toward Fed tightening late in 2022
Bloomberg business news
RBC Capital Markets Equity Derivatives Strategist Amy Wu Silverman talks about bond yields.Markets:”. (Source: Bloomberg)
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The bond market is about to get a serious reality check, with traders leaning heavily toward higher long-term yields and also a scenario where the Federal Reserve starts lifting rates from near zero well before officials now envision.

The big test of the profitability of these wagers is set to come Wednesday, when the Fed wraps up a two-day meeting. The likely key for bond investors is the trajectory officials pencil in for their policy rate over the coming few years. In December, they projected holding rates near zero through the end of 2023.