TLT - Bond Traders Think Interest Rate Cuts Are Ahead But One Caveat Keeps Yields Above 4% | Benzinga
The bond market is showing new signs of unpredictability as expectations over Fed rate cuts shift with every new piece of economic data.
Last week, Fed Chair Jerome Powell acknowledged that rate cuts for this year are being decided on a meeting-by-meeting basis. Therefore, it's not possible to predict how much the cost of borrowing will drop in 2024.
However, some investors continue to price in at least three rate cuts this year. This took the S&P 500 and other market gauges to record heights last week.
Investors priced in significant rate cuts for 2024 during the first two months, as inflation showed consistent signs of easing.
But rising prices from February's CPI report came in above economist expectations. And stronger than expected economic activity shows that inflation could be harder to tame than many had hoped.
Meanwhile, the fear ...