PREVIEW-Nervous bond investors batten down the hatches ahead of Fed meeting

NEW YORK, July 22 (Reuters) – Bond investors are bracing for more volatility from next week’s Federal Reserve meeting that is likely to deliver another steep interest rate increase, as market players continued to shed risky exposures and refrained from making big bets.

The Fed is widely expected to raise interest rates by 75 basis points (bps), as it did, shockingly, last month. What comes in subsequent meetings is up in the air. About a week ago the market was pricing in a full percentage point hike to be announced at the end of the two-day meeting on Wednesday.