Traders Bet on More Easing as Fed Opts for Half-Point Rate Cut
- Market prices in about 70 basis points of easing left in 2024
- Fed officials see another half-point of cuts coming this year
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Traders ramped up their bets on the pace of future US interest-rate cuts after the Federal Reserve reduced its benchmark by half a point and signaled more cuts coming this year.
The market is now pricing in another 70 basis points worth of rate reductions at the Fed’s two remaining meetings this year, reflecting a far more aggressive stance than policymakers. Officials on Wednesday forecast just a half-point of further easing in 2024, though Chair Jerome Powell made clear that Wednesday’s decision wasn’t indicative of the pace ahead for cuts.