Bond Market’s Bears Undaunted by Post-Fed Shakeout of Short Bets
- Quarterly gain reduces Treasuries’ losses to 2.8% in 2021
- But investor bias remains toward higher yields: JPMorgan data
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The bears in the Treasury market are proving steadfast in their bets on higher yields, even as U.S. government debt is on pace for its biggest quarterly gain since the pandemic struck early last year.
The Federal Reserve’s hawkish shift this month dealt a blow to wagers on a selloff in Treasuries and a steeper yield curve by briefly tamping down inflation concerns. The benchmark 10-year rate is around 25 basis points below the 14-month peak touched at the end of March. That drop has helped spur the market’s roughly 1.5% gain this quarter, shaving 2021 losses to about 2.8%, according to Bloomberg Barclays index data through June 24.