Traders Bet on Hawkish Policy Mistake on Both Sides of Atlantic
- Interest-rate market signals monetary easing in coming years
- ‘Policy-error pricing is creeping in for the Fed,’ says Citi
This article is for subscribers only.
A cohort of traders is betting the hawkish monetary lurch on both sides of the Atlantic will prove a policy mistake down the road -- forcing central banks to cut rates to salvage economic growth.
As a slew of Wall Street names including former Salomon Brothers chief economist Henry Kaufman and bond-market veteran Dan Fuss lash authorities for letting inflation run wild, one corner of the interest-rate market now suggests the Federal Reserve will be forced to reverse course in three years’ time.