Posted by DigiNomad on 30th of Jan 2024 at 05:42 pm
Correction - it's pricing in 75 points in May!
Fed funds probabilities - something is freaking out the bond
market. This is the table for the May meeting as of right
now. They completely took a hold until June off the table (0%
chance) and are now betting on a 75 point cut (47.7% chance with
35.9% of a 50 basis cut).
My sense is that the Fed isn't going to push back very hard
on this tomorrow. It's an election year and the Fed is completely
dominated by a single party. But more importantly, it seems like
something is broken or nearly broken under the surface. The fed
didn't break it and we should let it play out and fix itself, but
when you're a hammer everything looks like a nail - lowering rates
and socializing losses with liquidity programs is all the Fed
knows.
Posted by jhbernstein on 31st of Jan 2024 at 07:24 am
I think you just happened to look when there was a bad data
print. Currently showing just a 0.7% chance of 75bps in May.
13.9% chance of a hold, 51.9% chance of a 25bp cut and 85.4%
chance of either 25 or 50.
Posted by DigiNomad on 30th of Jan 2024 at 05:47 pm
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Correction - it's pricing in
Posted by DigiNomad on 30th of Jan 2024 at 05:42 pm
Correction - it's pricing in 75 points in May!
Fed funds probabilities - something is freaking out the bond market. This is the table for the May meeting as of right now. They completely took a hold until June off the table (0% chance) and are now betting on a 75 point cut (47.7% chance with 35.9% of a 50 basis cut).
My sense is that the Fed isn't going to push back very hard on this tomorrow. It's an election year and the Fed is completely dominated by a single party. But more importantly, it seems like something is broken or nearly broken under the surface. The fed didn't break it and we should let it play out and fix itself, but when you're a hammer everything looks like a nail - lowering rates and socializing losses with liquidity programs is all the Fed knows.
I think you just happened
Posted by jhbernstein on 31st of Jan 2024 at 07:24 am
I think you just happened to look when there was a bad data print. Currently showing just a 0.7% chance of 75bps in May. 13.9% chance of a hold, 51.9% chance of a 25bp cut and 85.4% chance of either 25 or 50.
Posted by DigiNomad on 30th of Jan 2024 at 05:47 pm