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Fed Rate Path Holds Post Payrolls/ISM Decline Before Powell

STIR FUTURES
  • Fed Funds implied hikes little changed after yesterday’s mild easing: 31.5bp for Feb (+0.5bp), cumulative 50.5bp to 4.84% Mar (+0.5bp), terminal 4.94% Jun (+0.5bp) and 4.46% Dec (+2bp).
  • The terminal holds ~10bps lower just before payrolls/ISM services.
  • Powell at 0900ET before of course CPI on Thu. Yesterday, ’24 voters Bostic and Daly warned about declaring victory on inflation prematurely whilst data dependency sees the Feb decision as between a 25bp or 50bp hike on the way to a terminal above 5%.


Source: Bloomberg

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