Report
Fed: uncertainties grip the market
Past we ek has once again been marked by the repricing of market expectations regarding the monetary policies of major central banks. In particular, the recent surprise on the US inflation (released above expectations), the second in the month following the exceptional resilience of the labor market, weighed on overly optimistic expectations for the first Fed Funds rate cut in March. As a result, the market shifted to May, or even June, limiting the total anticipated rate cuts for 2024 to 96 basis points (as of yesterday), compared to the 160 basis points expected at the end of 2023. Macroeconomic releases over the next two months (including employment and inflation statistics) will be crucial in determining the timing of the Fed’s move. At the moment , we are maintaining our forecast for the beginning of the Fed’s monetary policy easing in May, despite increased uncertainties.
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Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
Inna Mufteeva
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