Overview

• Traders are betting on a 2024 bond rally, seizing on elevated yields before the Federal Reserve starts driving down interest rates.
• Despite recent pullback, investors are increasingly confident that the bond market is recovering from its worst downturn in decades.
• Traders anticipate the Fed may start easing monetary policy as soon as March.
• Strategists at TD Securities predict the 10-year Treasury yield will end 2024 at 3%.
• The degree of Fed's easing will depend heavily on whether inflation continues to recede.