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A US$1 trillion pain trade in the Treasuries divides top bond dealers

Consequences of Fed's pullback from Treasury purchases to replace the matured ones extend beyond bond market

New York

TO APPRECIATE just how important the Federal Reserve has been to the US Treasury, consider this simple fact: It alone financed roughly 40 per cent of America's budget deficit last year.

So as Fed officials talk up the possibility of unwinding the central bank's crisis-era...

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