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FOMC-Dated OIS Off Of Yesterday’s Hawkish Extremes Into PCE

STIR

15 minutes ahead of the latest round of PCE data we see FOMC-dated OIS pricing ~10.5bp of tightening for the June gathering, with a cumulative ~20.5bp of tightening priced through July (which represents terminal rate pricing), with the strip off of yesterday’s hawkish extremes.

  • Beyond July, ~38.5bp of cuts are priced by year-end.
  • Outside of today’s domestic data, participants remain attuned to debt ceiling dynamics, with the Memorial Day weekend (and related market closures/shortened trading days/thinner liquidity having the potential to exacerbate moves if meaningful headline flow is forthcoming over the next couple of sessions).
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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