From SOFR options to bond market tilt: traders are going crazy hedging "Fed shift" in September or a 50 basis point aggressive easing.

According to the Wise Finance APP, signs of weakness in the US economy have emerged, providing a basis for the Federal Reserve to respond to Trump's calls for a rate cut. The bond market is increasing bets on rate cuts this year. Options tracking monetary policy show that investors are positioning themselves for the possibility of rate cuts at the remaining three interest rate meetings, expecting a cumulative rate cut of 75 basis points by 2025. Some funds are even betting on a direct 50 basis point cut at the September meeting.