Amundi Downgrades U.S. Treasuries Duration Outlook; Fed Unlikely to Cut Rates Until Q2 2027

According to Amaury D'Orsay, head of fixed income at Amundi (Europe's largest asset manager), the firm has slightly downgraded its U.S. Treasuries duration outlook today, citing resilient U.S. economic growth and expectations that the Federal Reserve will hold rates unchanged until Q2 2027. D'Orsay noted that the short end of the yield curve is overvalued while the long end faces fiscal risks, and added that the firm currently favors inflation-linked bonds. Amundi's investment research head Monica Defend stated the Fed is in "wait-and-see mode" and will maintain rates for an extended period before resuming cuts.
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