Following the softer-than-expected CPI overnight traders increased bets that on Fed rate cuts through 2025/6 with two easing’s expected in Christmas and one more in 2026. No surprise that following the CPI report, Trump reiterated his call for the Fed to lower interest rates by “one full point.” The president continued “Would pay much less interest on debt coming due. So important!!!” on Truth Social.
- We can see the US 2s testing 3% over the coming 6-12 months.
MM remains bullish toward US Bonds (bearish yields)
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