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STIR: OI Points To Mix Of Positioning Swings As SOFR Twist Steepened Post-Fed

STIR

OI points to long setting in the very front end of the SOFR strip (SFRU4 & Z4) on Wednesday, while a mix of short setting and long cover was seen further out.

  • Markets had to adjust to the delivery of the Fed’s 50bp cut in the very front end, which wasn’t fully discounted.
  • Further out the strip was impacted by Chair Powell’s steer towards a higher neutral rate than in recent times.

 

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OI points to long setting in the very front end of the SOFR strip (SFRU4 & Z4) on Wednesday, while a mix of short setting and long cover was seen further out.

  • Markets had to adjust to the delivery of the Fed’s 50bp cut in the very front end, which wasn’t fully discounted.
  • Further out the strip was impacted by Chair Powell’s steer towards a higher neutral rate than in recent times.

 

Keep reading...Show less