Treasuries Gain as Traders Hold to Rate-Cut Bets After Fed

Group 1 - Treasuries experienced a rise for the second consecutive session as traders anticipated additional rate cuts next year following a less hawkish Federal Reserve meeting [1] - Yields fell across most tenors, with the benchmark 10-year notes reaching their lowest level in nearly a week, closing little changed after gains initiated on Wednesday [2] - The Federal Reserve's announcement of reserve management purchase operations overshadowed expectations for a hawkish cut, leading to a bias towards lower yields as investors become cautious towards year-end [3] Group 2 - A higher-than-expected reading of initial jobless claims at 236,000 for the week ending December 6 supported the demand for Treasuries, marking the highest jump since the early pandemic days [4] - Following the Fed meeting, money markets are pricing in a roughly 50% chance of a quarter-point cut in March 2026, with expectations for two reductions next year aligning with market forecasts [5] - The dovish moves by the Federal Reserve have led bond investors to bet on a soft-landing scenario, reviving interest in the steeper yield curve trade [6]