According to CoinMeta, recent bullish investors in the U.S. bond market have suffered heavy losses due to remarks by two Federal Reserve officials and signs of persistent inflation, which increased the likelihood of interest rate hikes. This led to a significant decline in U.S. Treasury bonds. The selling pressure on Tuesday spread across various maturities of U.S. Treasuries. Federal Reserve Governor Christopher Waller expressed support for interest rate hikes and stated that if inflation continues to accelerate, he would favor a 50-basis-point increase. Traders immediately began to price in a more aggressive Fed tightening path. Consumer price data that exceeded expectations further fueled the trend, and the hawkish remarks by Dallas Fed President Lorie Logan also exacerbated this change. This round of selling pushed the yield on 2-year U.S. Treasuries to its largest increase in 19 months, with the yield on 10-year Treasuries briefly returning above 5%, catching investors who had recently flocked to U.S. bonds due to trading related to the AI theme off guard. In a report dated November 8, strategists at Bank of America noted that over the past week, asset management companies continued to build long positions in futures across different maturities of the yield curve, while simultaneously covering their short positions on the longer end.