Economics
Hedge Funds Pile Into a Record Hawkish Rate Bet Pre-Jackson Hole
- Position set to benefit if Powell rules out dovish pivot
- Shorts triple in a month even as market sees rate cuts in 2023
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Hedge funds are unleashing record bets the Federal Reserve will stick to its hawkish script at Jackson Hole to rein in the fastest inflation in four decades.
The group has collectively placed a big short across futures for a key overnight rate that moves in line with the Fed’s benchmark. The position, which has more than tripled in the past month, will benefit if Fed Chair Jerome Powell effectively rules out a dovish pivot when he speaks at this week’s symposium.