l. This change in expectations reflects investors’ caution in the face of economic uncertainty and the mixed signals provided by financial indicators.
According to the statements of Raphael Bosticpresident of the Atlanta Federal Reserve, The bank plans to postpone any adjustment in interest rates until the arrival of summer (June).
This decision had a full impact on the expectations of investors who operate futures contracts linked to Federal Reserve interest rateswho, following the release of a government report, revealing an unexpected increase in wholesale prices during January, They have reduced their bets regarding a possible cut in interest rates.
Before the release of the report, which highlighted a 0.5% increase in the underlying producer price index from the previous month, traders were giving a 75% probability to the possibility of the Fed implementing its first rate reduction. rates in June.
Howeverafter the dissemination of this data, the probability of a rate cut in the same period fell sharply, standing slightly above 50%, according to the evaluation made through the valuation of the Federal Reserve’s federal funds futures contracts. This change in expectations reflects investors’ caution in the face of economic uncertainty and the mixed signals provided by financial indicators.
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
