Bond traders are betting the Federal Reserve will cut interest rates, taking record risks in Treasury futures

Bond traders are taking on record risk as they bet heavily on the Treasury market in anticipation of the Federal Reserve's first interest rate cut. Leveraged positions in Treasury futures have risen to a record high ahead of the central bank's annual meeting in Jackson Hole on Thursday. Unpositioned squaring positions rose to the equivalent of nearly 23 million 10-year Treasury futures contracts last week, a record and equivalent to a risk of about $1.50 billion per basis point, according to CME Group data and institutional analysis.