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With doubts about the credibility of the Federal Reserve, global bond investors such as Schroders are shifting towards Australian and European markets, exacerbating the sell-off in U.S. Treasuries.

With doubts about the credibility of the Federal Reserve, global bond investors such as Schroders are shifting towards Australian and European markets, exacerbating the sell-off in U.S. Treasuries.

智通财经智通财经2026/07/31 00:36
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(1) As market doubts about the Federal Reserve's ability to control inflation intensify, global bond investors such as Schroders, which manages assets worth 110 billion USD, are seeking to shift towards the Australian, UK, and Eurozone markets, further increasing selling pressure on US Treasuries. Schroders is expanding its short positions in US Treasuries while buying short-term government bonds in the aforementioned markets.(2) The company believes that the latest Federal Reserve meeting once again confirms its assessment—that US policymakers may still need to tighten policy further. The fund is betting that short-term government bond yields in Australia, Europe, and the UK will decline, while also holding short positions in US five-year and ten-year Treasuries.(3) The head of Schroders' Australian fixed income division stated that the Federal Reserve meeting reinforced their view of maintaining or even increasing US Treasury short positions, and that “there are plenty of excellent opportunities outside the US”—because compared to current market pricing, the central banks of Australia, Europe, and the UK are more likely to keep interest rates unchanged.
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