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● LIVE Updated 27d ago · 11 sources tracked

US bond market expects rate hikes the Fed may never deliver

The US bond market is pricing in interest rate hikes that diverge from Federal Reserve guidance. Rate futures indicate at least one hike by early autumn and another next year. Some investors believe these market expectations are too aggressive and anticipate a rate cut instead.

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What changed

The 10-year Treasury yield reached a 52-week high of 4.6%.

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  1. US Bond Market Prices in Rate Hikes Amid Fed Policy Uncertainty

    The US bond market is pricing in interest rate hikes that diverge from Federal Reserve guidance. Rate futures indicate at least one hike by early autumn and another next year. Some investors believe these market expectations are too aggressive and anticipate a rate cut instead.

    What's confirmed:

    • The 10-year Treasury yield hit a 52-week high of 4.6%.
    • Bank of America expects three rate hikes in 2026.
    • Fed Chair Kevin Warsh has used hawkish rhetoric that flattened the yield curve.

    Still unconfirmed:

    • The US bond market is pricing in two rate hikes by year-end.
    • Rate futures price in a hike later in 2026 and another in 2027.
    • Traders in rate futures are pricing in a hike by early autumn.
    confidence 80%