"Fed Will Lower Rates Again Before January Trading History Shows"

Sep 24 07

"Fed Will Lower Rates Again Before January Trading History Shows" Says Bloomberg. Monday's Elizabeth Stanton article discusses two indicators pointing to lower rates -- 2-year Treasury note yields over 50 basis points below the Fed fund target and Fed funds futures. Futures currently predict at least two more 1/4-point reductions, though their record of accuracy is mixed at best. The piece says, "[T]raders have pushed the yield on Treasury two-year notes to almost three quarters of a point below the designated 4.75 percent funds rate. In the three previous occasions during the past 20 years when that has happened, policy makers have cut borrowing costs."

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