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No $-Bloc Market Has Three Cuts Fully Priced By Year-End

STIR

Over the past two weeks, STIR markets within the $-bloc have firmed by 7 to 20bps, with the US showing the most significant gain and Australia trailing behind.

  • The Canadian and NZ markets have both seen around a 10bp firming ahead of tomorrow's BoC and RBNZ policy decisions. (See MNI Previews here: BoC and RBNZ)
  • Consequently, none of these markets currently have three 25bps rate cuts priced in for year-end, contrasting with the situation two weeks ago when both the US and Canada had around 80bps of easing priced in.
  • At that time, NZ had 70bps priced in compared to 59bps presently, while Australia had 38bps of easing priced in contrast to the current 30bps.
  • December 2024 expectations and the cumulative easing across the $-bloc stand at: 4.68%, -65bps (FOMC); 4.30%, -70bps (BoC); 4.01%, -30bps (RBA); and 4.92%, -59bps (RBNZ).

Figure 1: $-Bloc STIR (%)


Source: MNI – Market News / Bloomberg

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