Fed rate cut bets continue to increase, initial jobless claims data confirms a weak job market

A U.S. government report showed initial jobless claims jumping to a near four-year high. Short-term interest rate futures markets continued to increase bets on Federal Reserve rate cuts, ranging from expectations of at least two rate cuts by the end of the year, to bets on four consecutive rate cuts between September and January, to fully pricing in three rate cuts this year, implying that the Fed will cut at all of its remaining meetings this year. However, a stronger-than-expected increase in the CPI in August may prevent the Fed from initiating significant rate cuts. The probability of a 50 basis point rate cut in September has risen slightly from 8% before the announcement to 10.9%. (Jinshi)