Trend funds (commodity trading advisors, CTAs) have increased their short bets on global bonds to a record level, with assets under management estimated to exceed $400 billion. UBS data shows that CTA's profit and loss exposure is approximately $300 million for every 1 basis point change in 10-year US Treasury yields ahead of inflation data, the highest level since UBS began compiling this data in 1990. The market is closely watching the US July Consumer Price Index (CPI) report, to be released on Wednesday evening Beijing time, which could strengthen or weaken expectations of a Federal Reserve rate hike as early as September, and potentially trigger a bond rally, forcing CTA shorts to face pressure to cover their positions.