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The Fed On Hold For A Year According To The Futures Market

Published 10/14/2014, 01:45 AM
Updated 07/09/2023, 06:31 AM

Futures markets have shifted expectations for the Fed's liftoff further out in time. The July-15 Fed Funds futures contract is only pricing a 12bp Fed Funds rate increase from the current levels - not enough for a full hike.

30-Day Fed Funds Daily Futures

In fact the mean expectation for the rate increase timing priced into the Fed Funds futures market is roughly a year from now.

Implied Change in Fed Funds Futures

This should slow the appreciation of the US dollar, as the Fed tries to avoid getting too far ahead of other developed economies in its normalization strategy.

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