BlockBeats news, December 19, some bond traders have been increasing options and futures bets, expecting the Federal Reserve to signal a larger rate cut next year than the market anticipates. U.S. Treasuries rose moderately on Wednesday ahead of the Federal Reserve's policy decision.
Given that a 25 basis point rate cut by the Federal Reserve is essentially seen as a done deal, the market's focus is on the Federal Reserve's latest quarterly projections. The dot plot released in September showed officials expect rate cuts of 100 basis points each for this year and next.
However, considering that inflation data is showing stickiness, the overall market is betting that the Federal Reserve will lower its forecast for rate cuts next year, with swap rates suggesting only a 50 basis point cut next year. (Jin Shi)