Treasuries traded steadily after a reading of US wholesale prices last month rose less than anticipated, affirming wagers that the Federal Reserve will cut interest rates at least once this year even as the broader inflationary outlook remains murky amid the war in Iran.
By at least one metric in the $9.5 trillion foreign-exchange markets, demand for the dollar is ebbing amid the tenuous ceasefire between the US and Iran.
The dollar is on track for its best month since July as the conflict in the Middle East scrambles Wall Street’s playbook for the world’s dominant reserve currency.
Treasuries gained across the curve as softer-than-forecast US inflation data led traders to step up bets that the Federal Reserve will cut interest-rate next year.
Emerging market carry trades, a popular strategy that returned about 17% in 2025, are widely expected to continue yielding gains in 2026 due to persistent interest rate gaps and a weakening US dollar.
Investors looking to profit from a “Goldilocks” environment where US stocks rally but Treasury market losses are contained should short the dollar, according to a new study published by Morgan Stanley.
Betting against the dollar has been the dominant trade this year in the $9.6 trillion-a-day foreign-exchange market, but the wager is starting to stumble.
Treasuries soared and traders added to bets on a September interest-rate cut after Federal Reserve Chair Jerome Powell indicated a reduction may be warranted to support the labor market.
The Treasury market rallied after an auction of 10-year notes drew strong demand, easing concerns that investors will balk at financing swelling US deficits.
The dollar is headed for its best year in almost a decade as US economic strength reins in expectations for the Federal Reserve’s rate-cutting cycle and President-elect Donald Trump’s threats of harsh tariffs underpin bullish bets on the currency.
Dollar bulls emboldened by Donald Trump’s win are entering a month that has historically punished the greenback.
Wall Street veteran Ed Yardeni says the approaching US election could augur the return of the market’s bond vigilantes as the Treasury Department readies new debt issuance plans.
Mohamed El-Erian says the Federal Reserve needs to renew its focus on its fight against rising prices after September’s surprisingly hot jobs report served as a reminder that “inflation is not dead.”
Wall Street’s biggest banks are divided over how fast and deep the Federal Reserve will cut interest rates over the next year, setting the stage for jittery financial markets until the outlook clears.
Investors are using their massive cash piles to lock in attractive yields in global bond markets, helping to limit losses in the asset class, according to Mohamed El-Erian.
All signs point to a tough few months ahead for investors charting the dollar’s path, after the US presidential debate and a key inflation reading left markets anticipating heightened volatility through year-end.
Investors weighing election risks ahead of the first US presidential debate between Vice President Kamala Harris and former President Donald Trump are already a lot more jittery than they were before Trump and his onetime opponent, President Joe Biden, met onstage in June.
The dollar plunged after Federal Reserve Chair Jerome Powell affirmed expectations that the central bank will cut interest rates next month, sparking a rally in the currencies of major global peers.
Citigroup Inc. says the carry trade is back, but with a key difference: hedge funds are borrowing US dollars rather than the yen for their wagers on emerging markets.
The bond trade that some of Wall Street’s biggest banks say will dominate the rest of 2024 is gaining steam before a crucial inflation reading that will help seal the wager’s fate.
Financial giants from Goldman Sachs & Co. to Morgan Stanley and Barclays Plc. are taking a fresh look at how a Donald Trump victory in November could play out in the bond market.
The Federal Reserve’s move to signal fewer interest-rate cuts this year deepens its divergence from peers who have already begun to ease.
BlackRock Inc.’s Rick Rieder has some advice that bucks conventional wisdom: The best way for the Federal Reserve to temper inflation will be to lower rates, not hold them higher.
The world’s financial markets are encountering a force they didn’t bet on for 2024: A strong dollar is back and looks set to stay.
Policymakers around the world are struggling to confront a surging greenback and lofty US interest rates, according to Mohamed El-Erian.
Mohamed El-Erian still expects Federal Reserve officials to cut interest rates twice this year, even as a blockbuster jobs report pushes traders to rethink the timing.
There’s one topic dominating the agenda as FX traders descend on Miami this week: how the currency market can adjust to a fast-approaching change to US stock settlements that stands to shake-up their industry.
Wall Street corporate bond desks are seeing a major increase in demand for hedges as debt issuers grapple with soaring interest-rate volatility.
The dollar is poised for its worst year since the onset of the pandemic as Wall Street bets the Federal Reserve is set to lower interest rates after reining in prices.
After clashing in recent years, Wall Street traders and the Federal Reserve are – for once – broadly in sync: The great monetary pivot is near as central bankers engineer a once-unthinkable soft landing in the world’s largest economy.
Credit risk will replace interest-rate risk as the market’s “big fear” next year, according to Mohamed El-Erian.
Bond traders are stepping up wagers that the Federal Reserve will steer the US economy into a recession.
