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Fed Terminal Trims Latest Data Spike

STIR FUTURES
  • The Fed implied terminal rate has pulled back from a post-data high of 5.27 to ~5.25% currently for the July meeting.
  • It’s still off the post-CPI high of 5.29% but compares with 5.18% pre-CPI and 4.84% pre-payrolls.
  • Near-term, we see a drift higher with now a cumulative 48-49bp of hikes priced over the next two meetings.


OIS and Fed Funds implied rate in July meetingSource: Bloomberg

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