Market Pricing More Credible Fed, but 'Onus' on Warsh to Deliver Sept. Rate Hike
Dow Jones
2 hours ago
0121 GMT - The market is pricing a more credible Fed in response to Fed Chairman Warsh's speech last Friday, three members of BofA Global Research say in a research report. "The [U.S.] yield curve flattened on the back of a sharp sell-off at the front end," the members note, citing market pricing of a Fed rate hike in September which is now over 60%. However, given Warsh's comments that the Fed should focus on trends rather than "isolated data points" and that underlying inflation hasn't "meaningfully improved" in recent months, the onus is now on Warsh to deliver a rate hike in September, the members add.
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