ETFs & Funds
Home›ETFs & Funds›Hedge Funds›CTAs raise bearish exposure to global government bonds…
CTAs raise bearish exposure to global government bonds ahead of US inflation
The increase marks their largest-ever short position in global government bonds, leaving them exposed to a sharp reversal if the latest US inflation data cools rate increase expectations.
Trend-following hedge funds, including CTAs, have boosted their bearish positions in global government bonds ahead of upcoming US inflation data, signaling higher downside bets on bond prices, according to Hedgeweek citing Bloomberg.
The report says CTAs are carrying their largest-ever bearish exposure to global government bonds, which could create a volatile setup if inflation data shifts expectations for additional Federal Reserve rate increases.
Hedgeweek, citing Bloomberg, warned that a weaker-than-expected inflation print could prompt a sharp reversal in these shorts by changing the market’s outlook for further Fed tightening.