Free Trial
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
STIR
- Fed Funds implied rates have cooled a little further from overnight highs as US desks filter in, leaving only a modest extension of yesterday’s bounce.
- Emergency cut frothiness has mostly dissipated: FFQ4 shows 2.5bp of cuts vs highs of 12bp yesterday and 1.5bp pre-payrolls.
- Cumulative cuts: 49.5bp Sep, 85bp Nov, 115bp Dec and 137bp Jan.
- Pricing for the September meeting holds the largest increase on the day (+4bp) as the narrative settles around a first 50bp cut rather than anything larger, barring further dovish triggers.
- Second 50bp cut prospects have also been trimmed as part of a path with 116bp of cuts by year-end (19bps fewer since ISM services and 33bp below dovish extremes).
- There is no scheduled Fedspeak today. We wouldn’t be surprised to see further commentary cautioning on overreacting to one data print, but we suspect there is only so much reaction this can now have following the rebound from dovish extremes.
- SF Fed’s Daly (’24 voter), with her labor market background, late yesterday offered further overreaction pushback, citing a still “reasonably solid” labor market. Policy adjustments will be necessary in coming quarters but she pushed back on reacting to a single data point. Details of the jobs report suggested there was more room for confidence and she wasn’t seeing or hearing of widespread permanent layoffs (recall almost three quarters of rise in unemployment in July was from temporary layoffs. MNI Employment Insight here).
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
We are facing technical issues, please contact our team.
ok
Your request was sent sucessfully! Our team will contact you soon.
ok