Lates News

Bond traders no longer fully factor in the expectation of a rate cut by the Federal Reserve in 2026. Interest rate swaps linked to the dates of Federal Reserve policy meetings show that traders on Thursday expect a rate cut of only 24 basis points this year, less than a full 25 basis point rate cut, while Wednesday night's expectation was around 30 basis points. This change comes as US Treasury yields continue to fall, with the two-year Treasury yield, which is most sensitive to changes in Federal Reserve policy, rising 4 basis points to nearly 3.70%. US bonds are facing pressure this week as investors worry that the ongoing conflict in the Middle East will continue to push up energy prices, leading to a resurgence in inflation.