Traders Lift Bets on a Fed Hike This Year as Yields Surge
Bloomberg.com • • business
Key Points:
- US Treasury bonds experienced a significant selloff, causing yields to rise by 12 to 15 basis points across various maturities amid escalating concerns over the Middle East conflict's impact on global inflation.
- Bond traders increased their expectations of a Federal Reserve interest-rate hike by October to 50%, reflecting heightened worries about prolonged geopolitical tensions.
- The selloff followed reports that the US is deploying three warships and additional Marines to the Middle East, intensifying market uncertainty.
- Money markets have completely ruled out any Federal Reserve rate cuts for the remainder of the year, reversing previous expectations of two quarter-point cuts prior to the US attack on Iran on February 28.
