Rate Options Show Rising Bets on a Half-Point Fed Cut This Month
- Open interest swells across multiple SOFR Sep24 call strikes
- Jobs report, CPI seen tipping scales for Sept. 18 meeting
This article is for subscribers only.
Rate options traders stepped up wagers that the Federal Reserve will kick off its easing cycle with a half-percentage-point cut this month, reflecting the increasing speculation that policymakers will act aggressively to keep the economy from sputtering.
Options tied to the Secured Overnight Financing Rate show that open interest, or the amount of positions owned by traders, has surged across a number of call contracts that expire on Sept. 13, five days before the central bank’s post-meeting announcement.