Portfolio managers have reduced their holdings in long-duration U.S. Treasuries ahead of an anticipated 25-basis-point rate cut by the Federal Reserve later this week. The shift reflects caution around term premiums and the potential impact of balance-sheet runoff adjustments. Many funds are concentrating exposure in the five-year segment to manage volatility as inflation trends stabilize. Analysts note that any signal about ending quantitative tightening could influence curve steepness and investor appetite. Current data suggests sentiment remains risk-neutral as traders await the Fed’s post-meeting communication and guidance.