The market began to expect the Fed to cut interest rates by 50BP in September

Due to concerns about the possibility of a US recession, the market has increased bets on the Fed to cut interest rates. The US 2-year Treasury yield continued its overnight decline, falling to 4.11% in early Asian trading, the lowest level since May 2023. As of press time, interest rate futures show that the market is pricing in an 87BP rate cut by the Fed this year, and there are still 13BPs to go before the bet of 4 rate cuts this year. The Fed still has 3 meeting windows to cut interest rates this year, and the probability of a 50BP rate cut by the Fed in September has risen to 33%. (Jinshi)