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FOMC OIS Now Shows 50/50 Odds Of One More Hike, Degree Of Cuts Priced Eases A Little On NFPs

STIR

The fallout from the NFP release biases the FOMC-dated OIS strip higher, with ~8bp of tightening priced for next month’s meeting (vs. ~6bp ahead of the print).

  • Elsewhere, terminal policy rate pricing sits at 5.455% (~2bp above pre-release levels), indicating near enough even odds of one further hike in the cycle, through the December meeting.
  • Beyond that point, cuts showing through Sep ’24 have moderated a little. The Sep ’24 contract has added ~8bp to pre-release levels, leaving ~49bp of cuts priced vs. prevailing terminal policy rate pricing levels.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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