The upcoming Federal Reserve decision is highly uncertain, with bond traders divided on whether the rate cut will be 25 or 50 basis points, reflecting the most doubt since 2007.
Philip Marey notes that the Fed's lack of guidance suggests a lack of consensus on the rate cut, while upcoming retail sales data could impact their decision.
Bill Dudley advocates for a half-point rate cut, emphasizing caution regarding inflation, while traders had previously ruled out anything larger than 25 basis points.
Traders are pricing in a 37 basis point reduction, indicating the market's expectation of a compromise between a quarter-point and a half-point decrease.
Collection
[
|
...
]