Investors are increasingly expecting the FED to take a major step in reducing interest rates.
Federal funds futures markets on Thursday showed a roughly 23% chance the Fed will cut its key interest rate by at least 0.5 percentage points by September, according to data from CME Group. That’s a significant increase from the 10% estimate a day earlier and the 4.1% estimate a week ago.
However, CME Group’s FedWatch tool only shows a 5% chance of a July rate cut. However, it almost certainly predicts a Fed cut in September following Chairman Jerome Powell’s Jackson Hole speech in late August.
The prospect of a significant rate cut is likely driven by Powell’s need to build broad consensus among policymakers. Dudley, a leading analyst, argues Powell is concerned that last year’s stalled progress on inflation could be repeated in the back half of 2024.
Interestingly, Fed officials don’t seem particularly bothered by the risk that the unemployment rate will soon exceed the Sahm Rule threshold. Developed by economist Claudia Sahm, the Sahm Rule suggests that recession risks are tied to a 0.5 percentage point increase in unemployment.
*This is not investment advice.
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Source: https://www.bitcoinsistemi.com/abdde-mega-faiz-indirimi-mi-geliyor-beklentiler-artti-iste-son-tahmin-verileri/
