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Fed Rate Path Consolidates Yesterday’s Decline Ahead of CPI

  • Fed Funds implied rates consolidate yesterday’s decline with US CPI firmly eyed at 0830ET.
  • Cumulative cuts from 5.33% effective: 1.5bp May, 15bp Jun, 25bp Jul, 41bp Sep and 67bp Dec.
  • The latter touched recent lows of 61bp earlier in the week but remains more than 5bps below pre-payrolls levels and the FOMC median dot for 2024.
  • Beyond CPI, focus will turn to FOMC commentary and the minutes from the March meeting in particular.
  • 0845ET – A hawkish Gov Bowman (voter) speaks on Basel Capital requirements which should limit any mon pol discussion and it’s too close to CPI for her to offer any views on the latest data if (albeit unlikely) asked in Q&A.
  • 1245ET – A dovish Goolsbee (’25) and hawkish leaning Barkin (’24) in a panel discussion on “Reimagining Full Employment”. Both have described Friday's jobs report as "quite strong"
  • 1400ET – FOMC Minutes – we’ll have more to say on this nearer the time

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