(Bloomberg) -- Wall Street’s last holdouts for a US interest-rate cut in July are preparing for their clearest sign yet on whether they — or traders in the...
-- Wall Street’s last holdouts for a US interest-rate cut in July are preparing for their clearest sign yet on whether they — or traders in the market — are correct about the likely path of Federal Reserve monetary policy.Billionaire-Friendly Modi Humbled by Indians Who Make $4 a DayJPMorgan Chase & Co. and Citigroup Inc. are among the few banks still predicting that the Fed will ease next month.
At the start of the year, forecasts for at least six quarter-point Fed rate cuts were common, and derivative contracts were priced accordingly. But progress toward lower inflation stalled and labor-market conditions stayed robust, removing the rationale for rate cuts. Fed Chair Jerome Powell “will explicitly keep all meetings on the table for a potential rate cut,” he said. “He might also emphasize that the committee is watching data and will make decisions on a meeting-by-meeting basis.”
JPMorgan economists retained their July rate-cut call based on April inflation readings that — though still higher than the Fed favors — at least moved in the right direction, Michael Feroli, chief US economist at JPMorgan, and colleagues said in a May 15 note. Expectations for what the Fed will do are critical to the performance of the bond market, where Treasury yields reached year-to-date highs in late April as expectations for rate cuts collapsed. Two-year yields, more sensitive than longer maturities to changes in the Fed’s rate, peaked above 5% and have retreated to around 4.7%.
-- New York developer Durst Organization secured new equity and debt for a Long Island City apartment building, Sven.
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