Bonds
Bond Traders Leaning on Fed Rate Cuts Eye Payrolls for Clues
- Swaps market favors a quarter-point rate reduction in December
- Front-end favored by traders as data seen keeping Fed in play
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Bond traders seeking support for bets that the Federal Reserve will cut interest rates later this month will closely watch Friday’s US employment report for November.
The monthly snapshot of the labor market arrives as the market-implied odds of a quarter-point rate cut at the central bank’s Dec. 18 meeting hovers around 65%, with about 82 basis points of easing priced in by the end of next year.