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U.S. Futures Reverse Pre-Jun FOMC Implied Tightening For The Year

STIR
BulletMarketsFixed Income

As we head into PMI data, U.S. rate futures have just about priced out the additional 2022 hiking seen after the pre-FOMC media revelations on Jun 13 that the June hike would be 75bp.

  • End-2022 implied Fed funds rate is now 3.40%, so about 175bp in hikes from here, but that's off from a peak of over 3.70% at the time of the Jun 15 FOMC decision.
  • A 75bp hike is still close to fully priced in for July, but the pace is seen downshifting to 50bp in September, with a further 50bp total for Nov and Dec.
  • Note that 3.40% is basically exactly in line with the FOMC's Dot Plot median for 2022.

Source: BBG

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As we head into PMI data, U.S. rate futures have just about priced out the additional 2022 hiking seen after the pre-FOMC media revelations on Jun 13 that the June hike would be 75bp.

  • End-2022 implied Fed funds rate is now 3.40%, so about 175bp in hikes from here, but that's off from a peak of over 3.70% at the time of the Jun 15 FOMC decision.
  • A 75bp hike is still close to fully priced in for July, but the pace is seen downshifting to 50bp in September, with a further 50bp total for Nov and Dec.
  • Note that 3.40% is basically exactly in line with the FOMC's Dot Plot median for 2022.

Source: BBG