For bond traders worried that Jerome Powell will trigger a selloff Wednesday by pushing back on their interest rate-cut bets, there’s a little historical consolation: Federal Reserve meetings are more likely to set off rallies instead.

Since March 2022, even as the central bank pushed through its steepest monetary policy tightening in decades, the three days bookending its meetings provided a brief reprieve from the bond-market pain. Ten-year Treasury yields actually fell by a total of 67 basis points during that window, breaking from the otherwise sharp push higher, data compiled by Bloomberg show.

It turns out that’s not an anomaly of the Fed’s hawkish turn. In the 11 years through 2021 — when 10-year Treasury yields generally drifted lower — almost 90% of the drop occurred during the period around the Fed’s meetings. Sebastian Hillenbrand, an economist who currently teaches at Harvard Business School, found a similar pattern going back as far as 1989.

Few have a comprehensive explanation for why bond yields tend to fall around FOMC days. To some investors, it’s evidence of the persistent faith in the “Fed put,” or the tendency of traders to hear a dovish message from a central bank they expect to cut interest rates whenever markets or the economy stumble.

That it also occurred when the bank was driving rates higher may also reflect traders’ ability to predict how the Fed would react to incoming data: As a result, interest-rate moves were priced in ahead of time, producing relief rallies when policymakers acted as expected.

Hillenbrand, who wrote his doctoral thesis on the phenomenon, said most recently it likely registers bursts of confidence that the Fed’s benchmark rate will come back down as the post-pandemic inflation surge recedes. He said that’s been reinforced by the Fed’s decision to keep its estimate of the neutral interest rate — the level that doesn’t effect growth one way or the other — at 2.5%. That’s less than half the 5.25% to 5.5% range the bank currently has on its benchmark rate.

“If you take the patterns seriously, yields have to come down,” he said.

It’s no sure thing, of course. While yields on a cumulative basis have dropped during the Fed-meeting window, they still edged up around six of the last 15 ones, the data show.

Moreover, Wednesday’s meeting could break with the long-term trend, given that traders would be disappointed if Fed Chair Powell dashes expectations that the central bank will start cutting rates as soon as March and continue doing so at a faster pace than its officials have predicted. On Tuesday, at the onset of the three-day window, yields edged up after data showed job openings unexpectedly rose in December to a three-month high.

But the pattern suggests that the bond market may keep getting outsized jolts around Fed meetings as it moves toward easing its rate back from a more than two-decade high.

Already, there are some reasons for confidence in the FOMC trade. Ten-year yields tumbled 31 basis points in the three days around the December policy meeting, when Powell effectively declared an end to its monetary tightening. It was the fourth-largest decline around Fed days since 1997.

Hillenbrand said the uncertainty in the bond market may undermine any efforts to predict short-term moves. But over time, he expects the trend to hold, with bonds tending toward gains whenever the Fed meets.

“There’re a lot of things that the Fed doesn’t have control over,” he said. “These forces could have increased yield volatility dramatically over the last two, three years. But that might not be that relevant for the long run.”

This article was provided by Bloomberg News.