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Near-Term Fed Pricing Back To Monday Levels After Week's Swings

STIR FUTURES
BulletMarketsFixed IncomeForeign Exchange
  • Expectations for upcoming FOMC meetings are finishing the week marginally higher than where they started with 54.5bp for June and a cumulative 103bps priced for July, having oscillated between 96-106bps.
  • However, despite Powell and Mester opening the prospects for larger than 50bp hikes further out if inflation doesn’t improve, hikes to year-end sit softer at 192bps.
  • The main data developments were the CPI beat although PPI and non-oil import prices both showed a faster than expected moderation in April and U.Mich consumer sentiment continued its downtrend in May.
  • Ahead: Williams and Empire Fed on Monday before Powell and retail sales on Tue.

Cumulative hikes priced by FOMC-dated Fed Funds futuresSource: Bloomberg

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  • Expectations for upcoming FOMC meetings are finishing the week marginally higher than where they started with 54.5bp for June and a cumulative 103bps priced for July, having oscillated between 96-106bps.
  • However, despite Powell and Mester opening the prospects for larger than 50bp hikes further out if inflation doesn’t improve, hikes to year-end sit softer at 192bps.
  • The main data developments were the CPI beat although PPI and non-oil import prices both showed a faster than expected moderation in April and U.Mich consumer sentiment continued its downtrend in May.
  • Ahead: Williams and Empire Fed on Monday before Powell and retail sales on Tue.

Cumulative hikes priced by FOMC-dated Fed Funds futuresSource: Bloomberg