September 28, 2018 / 8:48 PM / 8 months ago

UPDATE 1-Speculative U.S. 10-year T-note net shorts hit record high -CFTC

    * Fund managers' 10-year T-note net longs hit record high
    * U.S. 10-year yield hits 4-month peak on Tuesday
    * Speculative net shorts in T-bonds highest since 2010

 (Adds details, background)
    Sept 28 (Reuters) - Speculators' net bearish bets on U.S.
10-year Treasury note futures rose to a record high earlier this
week before the Federal Reserve's decision to raise key
overnight borrowing costs, according to Commodity Futures
Trading Commission data released on Friday.
    The amount of speculators' bearish, or short, positions in
10-year Treasury futures exceeded bullish, or long, positions by
756,316 contracts on Sept. 25, according to the CFTC's latest
Commitments of Traders data. 
    A week earlier, speculators held 684,712 net short positions
in 10-year T-note futures.
    Prior to the Fed's latest rate move, 10-year Treasury yield
 reached 3.113 percent on Tuesday, which was a
four-month high. It ended at 3.063 percent on Friday. 
    On Wednesday, the U.S. central bank raised key short-term
rates by a quarter point to 2.00-2.25 percent, marking the third
rate hike in 2018.
    Fed officials signaled they expected to increase rates
further as the labor market remains strong while inflation has
ticked up near its 2 percent goal.
    By investor group, asset managers' net longs in 10-year
T-notes hit a record high at 1.067 million contracts on Tuesday,
while hedge funds reduced their 10-year T-note net shorts to
947,000 contracts from a record 1.011 million the week before.
    Bond dealers' net shorts in 10-year T-notes increased to
163,485, the most in three weeks.
    Speculative net shorts in ultra bond futures grew to 234,334
contracts on Tuesday, within striking distance of the record
level reached in August.
    Speculators increased their net shorts in T-bond contracts
to 102,974, which was the highest since April 2010.

    Among other bond futures, speculators ramped up their net
shorts in two-year T-notes to 289,832 contracts, the highest
level since late January.
    Below is a table of the speculative positions in Treasury
futures on the Chicago Board of Trade and in Eurodollar futures
on the Chicago Mercantile Exchange in the latest week:
 U.S. 2-year T-notes (Contracts of $200,000) 
        25 Sep 2018       Prior week
 Long         470,953        471,032
 Short        760,785        680,399
 Net         -289,832       -209,367
U.S. 5-year T-notes (Contracts of $100,000) 
        25 Sep 2018       Prior week
 Long         586,882        595,992
 Short      1,413,449      1,405,646
 Net         -826,567       -809,654
U.S. 10-year T-notes (Contracts of $100,000) 
        25 Sep 2018       Prior week
 Long         483,500        510,780
 Short      1,239,816      1,195,492
 Net         -756,316       -684,712
U.S. T-bonds (Contracts of $100,000) 
        25 Sep 2018       Prior week
 Long         119,394        133,856
 Short        222,368        200,781
 Net         -102,974        -66,925
U.S. Ultra T-bonds (Contracts of $100,000) 
        25 Sep 2018       Prior week
 Long          91,393         91,452
 Short        325,727        321,427
 Net         -234,334       -229,975
 Eurodollar (Contracts of $1,000,000) 
        25 Sep 2018       Prior week
 Long         974,367        933,744
 Short      3,725,520      3,784,967
 Net       -2,751,153     -2,851,223
 Fed funds (Contracts of $1,000,000) 
        25 Sep 2018       Prior week
 Long         182,553        126,708
 Short        220,945        202,111
 Net          -38,392        -75,403
 (Reporting by Richard Leong; editing by Jonathan Oatis)
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