Investors are betting heavily on a fall in US Treasuries, which hit a record level of bearishness last week.

The overall indicator of changes in non-commercial net positions in the Treasury futures yield curve fell the most on record, according to the latest data from the Commodity Futures Trading Commission. Penglu Zhao, a strategist at TD Securities, said the change was equivalent to a $45 billion net short position in benchmark Treasuries.

Speculators joined the bears last week as markets were nervous about the risks of Fed retrenchment and early interest rate hikes, Zhao wrote on Friday. Dealers and leveraged funds are net buyers, while asset managers and other investors are net sellers.

The yield on the benchmark 10-year Treasury hit 1.62% on Friday, the highest since February 2020, before falling back. Investors were disappointed and bearish traders became more scrupulous after Federal Reserve Chairman Colin Powell failed to say he would take stronger action to curb the recent surge in yields.