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Fed Rate Path Consolidates Decline, Possibly Dovish Fedspeak Ahead

STIR
  • Fed Funds implied rates are near unchanged overnight having unwound Monday’s post-payrolls extension yesterday.
  • Cumulative cuts: 6.5bp for Mar, 21bp for May, 44bp for June and 122bp for Dec.
  • Fedspeak: Harker (non-voter) provided the last commentary late yesterday with the data point to continued disinflation and labor rebalancing.
  • Ahead sees a particularly stacked Fedspeak schedule, with our focus on Governor Kugler (permanent voter) and Boston Fed’s Collins (’25 voter) considering their lack of prior appearances – both with text and Q&A. Collins last spoke in mid-Nov and we haven't heard anything from Kugler since being sworn in apart from Reuters in Nov citing a letter that she was one of three Governors seeing room to run down the balance sheet.
  • There’s a chance one of them was the lowest 2024 dot at the Dec SEP with Goolsbee saying he wasn’t most dovish (one dot eyed 6 cuts, four dots eyed 4 cuts).

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