Following Barclays, strategists at Goldman Sachs also advised clients not to bet on the Fed cutting interest rates this year.
(Associated Press)
[Financial Channel/Comprehensive Report] After Barclays, strategists at Goldman Sachs also advised clients not to bet that the Fed will cut interest rates this year.
"Bloomberg" reported that the swap contracts (swap contracts) that refer to the date of the Fed meeting show that the market expects the policy rate to be about 70 basis points lower than the current level by the end of this year.
Goldman Sachs strategists led by Praveen Korapaty recommend buying contracts corresponding to the December Fed meeting in anticipation of higher interest rates.
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Strategists pointed out in a report that from the perspective of historical records, when the Fed conducts a series of interest rate hikes, it will keep interest rates unchanged for the next two times, and in the next six months, the most common practice It is to continue to stand still.
Goldman Sachs believes that this observation is contrary to market expectations for the direction of interest rates this year.
Barclays analysts advised clients last week to short the federal funds rate futures contract due in August 2023 at a price level of 95.06, also reasoning that a significant rate cut this year is unlikely.
The latest data from the Commodity Futures Trading Commission (CFTC) also showed that hedge funds expect the Fed to keep interest rates high for a longer period of time.
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