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Modest Hawkish Adj. In Fed Pricing On Data, Still A Little Over 65bp Of '24 Cuts Priced

STIR

Some modest hawkish adjustments seen in the wake of the firmer-than-expected retail sales and import price data.

  • Fed Funds futures show ~27bp of cuts through the September FOMC and ~66bp of easing through the Dec FOMC (vs. 28 & 68bp ahead of the data).
  • Ultimately, inflation and labour market data trends underpin the idea of fairly imminent easing from the Fed, with a little over 2.5x 25bp cuts priced through year end vs. ~40bp of cuts a little over a month ago and cycle extremes of ~28bp seen in early May.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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