U.S. interest rate futures pricing: Fed may not cut interest rates this year

U.S. interest rate futures are no longer fully pricing in even one rate cut from the Federal Reserve this year, after strong monthly jobs data released last Friday highlighted the resilience of the U.S. economy. Interest rate futures show that traders expect the Fed to cut interest rates by only 24.26 basis points by December this year, compared with about 43 basis points before the jobs data was released. Currently, traders are increasingly not betting on how much the Fed will cut interest rates from the current 4.25-4.50% rate range, which in turn boosted the dollar against most other major currencies. Against the backdrop of rising inflation and borrowing cost expectations, U.S. bonds have been sold off this month, pushing up (10-year) Treasury yields and making investors more confident that the Fed may not have as much room to cut interest rates as previously expected. (Jinshi)