Latest News

Bond Traders Now Lean Toward Quarter-Point Fed Hike in February


Bond Traders Now Lean Toward Quarter-Point Fed Hike in February By Bloomberg

Breaking News


Economy 3 minutes ago (Dec 13, 2022 17:14)

© Reuters

(Bloomberg) — As the dusts settles in the aftermath of November’s inflation data, bond traders have cut wagers on Federal Reserve interest-rate hikes next year, leaning toward a quarter-point increase as early as February. 

While interest rate swaps all-but-confirm a 50 basis-point move at Wednesday’s decision, a dovish repricing has swept through the Fed-dated contracts. In total, an additional 84 basis points of hikes are now priced into the next two policy meetings — favoring 50 basis points, then a 25 basis-point move. 

In total, the swaps market is now pricing the Fed’s policy rate to peak at just 4.85% by May, down from almost 5% ahead of Tuesday’s inflation print. Beyond May, the swaps market is now pricing 50 basis points of rate cuts over the second half of next year. The current Fed policy range is now 3.75% to 4%. 

With the half-point move solidifying for Wednesday’s meeting, investors will be looking for clues from the Fed Chair Jerome Powell on the potential for further easing in the policy path. Powell has emphasized the central bank’s commitment to returning inflation to its goal and the uncertainty of the outlook. 

©2022 Bloomberg L.P.

Bond Traders Now Lean Toward Quarter-Point Fed Hike in February

Our Apps

Terms And Conditions
Privacy Policy
Risk Warning

© 2007-2022 Fusion Media Limited. All Rights Reserved.

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

The Ratings Game: Mastercard, Fiserv and more: These payments stocks dubbed favorites for 2023

Previous article

Biden Hails Inflation Data as ‘Welcome News’ Ahead of Holidays

Next article

You may also like


Leave a reply

Your email address will not be published. Required fields are marked *

More in Latest News