Rising doubt: The Fed building in Washington. The US central bank has raised interest rates 11 times over the past two years. — Reuters
New York: Bond traders no longer expect the US Federal Reserve (Fed) to lower interest rates by more than 75 basis points this year, bringing their view in line with what Fed policy makers have indicated is the likeliest outcome.
Swap contracts that predict decisions by the US central bank repriced to higher rate levels, with the December contract’s reaching 4.58% in afternoon trading in New York and only 75 basis points lower than the effective federal funds rate of 5.33%. The Fed’s target band for that rate has been 5.25%-5.5% since July.
