Wall Street Macro Traders Had Their Strongest Financial Year in 2016: Global Interest Rate Fluctuations Drive Three Major Trading Businesses.

Notice that macro traders on Wall Street are on track for their best year since 2009, as clients are betting on changes in interest rate policies of major central banks worldwide. According to data from Crisil Coalition Greenwich, companies like Goldman Sachs, JPMorgan, and Citigroup are expected to generate $165 billion in revenue from fixed income, credit, and commodity trading this year, a 10% increase from 2024. The adjustments in global central bank interest rates, uncertainty in tariff policies, concerns about expanding fiscal deficits, and steep yield curve have particularly expanded the fee pool for interest rate traders. In G10 interest rate business, revenue is expected to reach a five-year high of $40 billion. Coalition Greenwich predicts a similar significant growth in 2026, with industry revenue forecasted to be $162 billion, just a 2% decrease. Nikhil Joralia, head of interest rate product trading at Goldman Sachs Europe, said in an interview: "Central banks are normalizing their policy rates and balance sheets, but what has not normalized is the massive issuance. These conditions are likely to persist. There is no reason for us to believe that the activity level we saw in 2025 will not reoccur in 2026." Fixed income traders are expected to have their best year since 2009 Macro traders in emerging markets are expected to generate the largest revenue in at least 20 years, reaching $35 billion. Credit traders are expected to earn $27 billion, and commodity traders are expected to earn $11 billion. However, Michael Karp, CEO of recruitment firm Options Group, said some traders hoping for sky-high bonuses may be disappointed. Karp said: "Expectations may not align with reality for interest rate traders." His company stated in a report that FICC bonus pools are likely to increase by an average of around 3% this year, with interest rate traders expected to see a 7% increase, emerging market traders a 5% increase, and FX traders a 4% increase. Karp said: "There will obviously be star performers who must be rewarded handsomely, but not at the level of 10 individuals. In the swaps, bonds, and volatility trading sectors, there will be one or two individuals per sector, that's it." Meanwhile, Karp's company found that bonuses for stock traders will be 14% higher than last year. This is because clients have been flocking to hot artificial intelligence stocks in recent months, with the stock trading department expected to achieve their best annual revenue in at least 20 years. Nomura Holdings' interest rate business has benefited this year from the Bank of Japan raising rates, even as the Federal Reserve and European Central Bank have been cutting rates. Moritz Westhof, head of US interest rate business at the firm, said the largest Japanese securities firm is currently seeking to help Asian clients invest more easily in European and American interest rate markets and help data center investments hedge using interest rate derivatives. He said: "Considering all the infrastructure and AI-related investments, how much of that can be hedged with interest rates over time? These investment scales are often very large, and they must be financed."