The world’s biggest bond market saw a day of reversals, with Treasuries paring their weekly rally as strong economic data reinforced the view that it may be too early for the Federal Reserve to claim victory over inflation.
At the end of a week marked by optimism the Fed would be closer to ending its interest-rate hikes, a report showed consumer sentiment soared to an almost two-year high — while short-term price expectations rose. Bonds reacted immediately, with the front-end of the U.S. curve bearing the brunt of the selling. Stocks posted mild losses as traders cited “consolidation” after a rally that still drove the S&P 500 to its best week since mid-June.
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