Fed Swaps Price in March and May Rate Hikes, Expect Peak at 5.3%

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Fed Swaps Price in March and May Rate Hikes, Expect Peak at 5.3%
News & Feeds

Fed Swaps Price in March and May Rate Hikes, Expect Peak at 5.3%

Wall Street traders fully priced in quarter-point increases at both of the Federal Reserve’s next two meetings — and a higher eventual peak for interest rates. The May overnight index swap contract rose to 5.11%, more than 50 basis points above the current effective fed funds rate. The market also priced in a higher so-called terminal rate, with the July contract rising to 5.31%, reflecting a roughly 70% chance of a third quarter-point hike in June. The moves accompanied the latest increase in US Treasury yields to their highest levels of the year, with the two-year note’s rising as much as 7 basis points to

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https://www.bnnbloomberg.ca/fed-swaps-price-in-march-and-may-rate-hikes-expect-peak-at-5-3-1.1885386