Traders begin betting on a 50 basis point rate cut by the Fed in September

BlockBeats news, July 15, bond traders are increasing their bets that the Federal Reserve will cut interest rates by 50 basis points in September, rather than the standard 25 basis points. Marilyn Watson, head of global fundamental fixed income strategy at BlackRock, said the Fed is likely to cut interest rates in September. But she also believes that the Fed may start moving ahead of schedule in July. CME Group Inc.'s futures open interest data showed that buying volume last Thursday was close to 260,000 contracts, setting a record for October contracts. Buying interest remained high last Friday. Higher-priced buying means that more people believe that the Federal Reserve may start the first easing cycle in recent years with a super-large-scale move.

Federal Reserve officials last week were considered to have sent the strongest signal of a rate cut so far. In public appearances last week, including two congressional hearings by Federal Reserve Chairman Powell, officials showed new confidence when talking about their control over inflation and whether they are ready to start a policy shift. Pimco economist Tiffany Wilding said that after the release of last week's data, it is "a done deal" that interest rates will be cut in September. (Jinshi)