According to BlockBeats, on July 15, bond traders bet that the Federal Reserve will cut interest rates by 50 basis points in September instead of the standard 25 basis points. Marilyn Watson, head of global fundamental fixed income strategy at BlackRock, said the Fed may act early in July.
CME futures open interest data showed buying volume approaching 260,000 contracts last Thursday, a record for October contracts. Buying interest remained high on Friday, indicating more people believe the Fed will start an easing cycle with a super-large-scale move.
Last week, Fed officials sent the strongest signal yet of a rate cut. Officials, including Fed Chairman Jerome Powell, showed confidence in inflation control and policy shifts in public appearances. Pimco economist Tiffany Wilding said a September rate cut was "a done deal."