Longer-term debt appears safer even if Fed raises interest rates soon

New York

WHILE debate rages over whether the Federal Reserve will raise interest rates this month, bond strategists seem to agree that longer-term Treasury securities look less vulnerable than short-term ones, and they're seeking ways to profit no matter what the Fed does.

Even as traders have pared back bets that policy makers will increase rates at their Sept 16-17 meeting, the prospect of a Fed move pushed yields on shorter-term Treasury notes to the highest since 2011 the last week. That has strategists focusing on a flattening trade, in which investors bet the yield difference between shorter- and longer-term notes will narrow - flattening the shape of the curve between them.