Five Things You Need to Know to Start Your Day: Asia

Good morning. Bond traders are deeply divided about how much the Fed will cut this week. Amazon is planning to reduce how many managers it has. And BlackRock is overhauling its private-credit business.—Nicole Bullock

Bond traders haven’t been this divided about the outcome of an upcoming Federal Reserve decision since before the great financial crisis of 2008. Fed policymakers begin their two-day meeting Tuesday and market pricing shows that it’s a tossup whether they opt to cut interest rates by a quarter-point, or take the more unusual step of lowering it by a half point. Excluding the emergency rate cut that the Fed implemented in March 2020 at the onset of the Covid pandemic, that’s the greatest amount of doubt in interest-rate swap markets for any scheduled US central bank decision since 2007, according to data compiled by Bloomberg. And there’s still scope for pricing to change yet: August retail sales data set to be released Tuesday could still alter the calculus ahead of the scheduled Fed decision which takes place at 2 p.m. Washington time on Wednesday.