Rubrics Morning Comment 17.01.24 – Rubrics – Asset Management

17th January 2024

Bonds Slump as Fed’s Waller Urges Caution on Interest-Rate Cuts

Treasury yields of all tenors rise at least 10 basis points

Amount of easing priced in for March ebbs from Friday’s peak

https://blinks.bloomberg.com/news/stories/S7DBD3T0G1KW

Fed’s Waller Urges Cutting Rates ‘Carefully’ If Inflation Cools

Central bank should be methodical, careful when cuts begin

No need to move as quickly as in past, says Christopher Waller

https://blinks.bloomberg.com/news/stories/S7DGFFDWX2PS

Bond Traders Start to Hedge Against Half-Point Fed Cut in March

Surge of activity seen in dovish SOFR options wagers last week

Pricing of Fed cuts has eased after Waller comments on Tuesday

https://blinks.bloomberg.com/news/stories/S7D2F6T0G1KW

America Inc. Is Paying Up to Hedge Debt as Rate Volatility Soars

Treasury volatility remains elevated by historical standards

Corporate issuers increasingly look to hedge before debt sales

https://blinks.bloomberg.com/news/stories/S6ZYG2DWRGG0

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