Bonds
Bond Traders’ Big Week Ends With Fed Rate Cuts Even Less Certain
- Swaps show 20% chance of a hold at one Fed meeting this year
- Robust US data have dented case for consecutive rate cuts
The bond market is growing less convinced by the day that the Federal Reserve will embark on two further interest-rate cuts this year.
Traders are pricing in roughly a 20% probability the Fed holds rates steady in either November or December. This time last week, even after Friday’s blockbuster jobs report, swaps still implied more than 50 basis points of cuts by year-end, likely via consecutive cuts.