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Analysis-‘Slam dunk’ Treasury trade becomes test of patience as yields march higher

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A sell-off in the U.S. government bond market is picking up speed, as a strong economy whittles away at hopes for imminent interest rate cuts from the Federal Reserve. Over the last month, investors have roughly halved the number of cuts they expect the Fed to deliver in 2024, amid booming job growth and stubborn inflation that have made the U.S. central bank hesitant to ease monetary policy too soon. That has exacerbated losses in bonds, complicating the outlook for investors who had bet Treasuries would rise as the Fed cut borrowing costs.

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