Treasuries Surge as Traders Bet on Emergency Fed Rate Cut
- Jobs data stokes worries the central bank has waited too long
- Traders price in a series of deep cuts through end of year
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Bond traders are piling into bets that the US economy is on the verge of deteriorating so quickly that the Federal Reserve will need to start easing monetary policy aggressively — potentially before their next scheduled meeting — to head off a recession.
Previous worries about the risk of elevated inflation have virtually disappeared, swiftly giving way to speculation that growth will stall unless the central bank starts pulling interest rates down from a more than two-decade high. Traders now see a roughly 60% chance of an emergency quarter-point cut within one week.