TYD - Is The Fed Going To Party Like It's 1995?

2024-03-06 10:50:00 ET

Summary

• One of the more noteworthy stories for the money and bond markets thus far in 2024 is the changing perception of the Fed policy outlook.
• While Fed officials continue to acknowledge that rate cuts seem likely later this year, a more recent development in the news was the comparison to the rate cutting cycle that occurred in 1995/1996.
• The bottom line is that any potential rate cuts for 2024 are going to be data-dependent.

By Kevin Flanagan

One of the more noteworthy stories for the money and bond markets thus far in 2024 is the changing perception of the Fed policy outlook. With rate cuts now being the primary focus, the conversation has revolved around when such a move could occur and what the path would ultimately look like. While Fed officials continue to acknowledge that rate cuts seem likely later this year, a more recent development in the news was the comparison to the rate cutting cycle that occurred in 1995/1996. Against this backdrop, I thought it would be interesting to provide the reader with some context and outline what Fed policy looked like nearly 30 years ago....

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