

Please try another search
(Bloomberg) -- Traders in the interest rate swaps market have concluded after the Federal Reserve rate decision that policy direction is set for a deeper dovish pivot from the middle of this year.
Swap contracts tied to this years Fed meetings show approximately 50 basis points of rate cuts are now firmly priced between the June policy peak of 4.90% to the 4.40% overnight lending rate tied to the December policy meeting.
For the next March policy meeting, just 21 basis points of rate hike premium is now priced, suggesting odds of 84% that the Fed will go another quarter-point. Beyond this, the outlook for another hike in May has fallen.
Wednesday’s dovish sentiment was more than matched in the options market tied to the Secured Overnight Financing rate, where a massive structure targeting a policy rate as low as 2.5% by year-end traded in huge size before and after the central bank meeting. By the end of the day premium paid for the wager had topped $60 million.
©2023 Bloomberg L.P.
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
I feel that this comment is:
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Enrich the conversation, don’t trash it.
Stay focused and on track. Only post material that’s relevant to the topic being discussed.
Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.