Updated from 7:34 a.m. EDT

The long-term bull market for bonds is far from over.

Even though government bonds posted their biggest quarterly loss in more than 20 years in the three months ended June 30, and most economists expect several more interest-rate hikes before the year is out, some pundits say there are reasons to remain enthusiastic about bonds.

"We think the secular bull market in bonds has years to run," said Lacy Hunt, chief economist at Hoisington Investment. "We don't think it's over by a long shot."

The Treasury market has seen some wild gyrations this year, with the yield on the 10-year note falling to an eight-month low of 3.65% in mid-March before soaring to a two-year high of 4.90% by mid-June.

The huge reversal came amid signs that the job market was improving and inflation was creeping higher. But over the past few weeks, the 10-year's yield has pulled back once again and continued to decline even after the Federal Reserve raised interest rates by 25 basis points last Wednesday. Thursday morning, the yield is sitting at 4.49%.

"I think that whatever the Fed is going to do this year is priced in," said Hunt, whose firm has correctly forecast a decline in interest rates over the past two decades. "The economy is in the process of decelerating and apparently rather sharply."

Indeed, employment growth was much weaker than expected in June and the Institute for Supply Management's manufacturing and services indices were both down last month from their levels in May. Durable goods orders have fallen for two straight months, auto sales have been disappointing and retailers like Wal-Mart ( WMT) and Target ( TGT) have issued warnings that point to a possible slowdown in consumer spending.

Some economists also note that money supply has been growing at a sluggish pace recently and has not been consistent with an overly accommodative Fed. In the week ended June 21, M1 grew 4.5% year over year while M2 grew 4.1%.

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