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Fed Implied Rates Tread Water Ahead Of CPI, Solid Fedspeak Tomorrow

  • Fed Funds implied rates remain unchanged for the Jul 26 decision (+22bp) but beyond that have edged higher on the day after reversing an overnight decline that continued from yesterday’s second half softer trading.
  • Cumulative change from 5.08% effective: +22bp Jul (unch), +28.5bp Sep (unch), +35bp Nov (+1bp), +30bp Dec (+1bp), +21.5bp Jan (+1bp). Rates are first seen lower than they are today with the May meeting (-8bps, +0.5bp on the day).
  • Cuts from Nov terminal: 5bp Dec’23, 63bp Jun’24 and 135bp Dec’24.
  • An event with NY Fed’s Williams today didn’t make headlines after little market reaction to his additional remarks to the FT overnight, although there is a heavier speaking line-up tomorrow after CPI.
  • Barkin (’24 voter) speaks on inflation just as CPI hits at 0830ET, Kashkari on mon pol (’23) at 0945ET, Bostic at 1300ET (’24) and Mester (’24) at 1600ET. There is also the Beige Book plus the Senate Banking Committee hearings on Fed Board nominations.

Source: Bloomberg

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