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Extreme dovishness has faded slightly over......>

FED
FED: Extreme dovishness has faded slightly over the past week, but markets see
the Fed very much on a path to ease significantly in the next 12 months.
- MNI PINCH shows a 25bps cut fully priced in at the July 31 meeting, with a
23.4% probability of a 50bps reduction.
- The odds of the latter were reduced significantly last week (from 55.2% chance
of a 50bps cut) by less-dovish-than-expected comments by Fed's Bullard and Chair
Powell on June 25, as well as a G20 outcome that was not as bad as feared.
- Even so, four 25bps cuts remain fully pencilled in by September 2020, with
50bps expected to be delivered in 2019.
- For full details see our MNI PINCH update published this afternoon:
https://emedia.marketnews.com/marketnewsintl/MNI_PINCH_01-07-2019.pdf

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