VGSH - U.S. Treasury Market Misjudges Timing On First Rate Cut... Again
2024-02-06 12:01:00 ET
Summary
- In the spring of 2023, the bond market rallied sharply, effectively forecasting a rate cut by the Federal Reserve.
- Strong economic news for fourth quarter GDP and January payrolls added to the view that growth remains resilient, and so rate cuts can wait.
- May could mark the start of a run of dovish policy, but the Fed, as ever, is looking for incoming to provide support for pulling back from restrictive policy.
We've been here before. In the spring of 2023, the bond market rallied sharply, effectively forecasting a rate cut by the Federal Reserve. But the punt turned to tears as the Federal Reserve continued raising interest rates, causing bond prices to sink and yields to spike....
U.S. Treasury Market Misjudges Timing On First Rate Cut... Again