Bond Strategists Turn Bullish on Long-Term US Sovereign Debt
· Business · LiveMint, Bloomberg
Prominent market strategists Anatole Kaletsky and Jim Bianco are reversing their long-held avoidance of government bonds to champion 10- and 30-year U.S. Treasuries. The shift comes even as the $47 billion iShares 20+ Year Treasury Bond exchange-traded fund recorded its longest losing streak ever at 10 straight days. Despite the downturn, investors poured $5.3 billion into the fund this year as of Monday, reversing negative year-to-date flows. Market consensus expects the Federal Reserve to lift the benchmark Fed-funds rate to 4.75% by the end of 2027 from its current target range of 3.75% to 4%. However, bulls anticipate that future interest rate cuts will drive down yields and push bond prices higher, supported by Federal Open Market Committee forecasts showing expected rates below 4.25% in 2027.
Why it matters
Fixed-income investors and institutional funds navigating shifting Federal Reserve monetary policy must weigh whether falling future interest rates will offset current Treasury market losses.
Read the original report — LiveMint
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