There has been bloodbath for bonds and the US treasurys has seen its worst crash in the history of its index (see below):
No need to question that the sentiment of the bond traders has never been more depressed at the moment. There seems to be no sign of any light at the end of the tunnel. After all, the extremely hawkish Fed these days has made the market believe that it is a certainty that rates will go a lot higher from here and the Fed rate could shoot up towards 3% by the end of the year with each meeting hiking the rate. The inflation trend is also supporting this projection.
But I don't buy it and as I said before, I have a high doubt that the Fed can really raise interest at each meeting this year. In other words, I think the interest rate may likely move down from here. The extremely depressed mood of the bond market is a contrarian indicator, which suggests we are likely seeing the worst of the bonds. If you ask me what to do, I'm betting on a rally of the bonds.
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