The USD OIS curve now prices around 50bp of cuts this year, with a 95% chance of cuts in September and December, fully pricing in such an outcome.
Fed pricing is now more hawkish compared to Q1, with markets earlier expecting up to six 25bp cuts, but recent data and Fed's stance indicate the next move will likely be a rate cut.
SOFR options show a mere 3% probability of another rate hike by year-end, with Chair Powell's indication that a hike is 'unlikely', alongside promising inflation data and softer economic figures, supporting this notion.
[
add
]
[
|
|
...
]