Traders Expect 1.25% Rate Cuts By Year-End: Fed's Goolsbee Focuses On Jobs, Analysts See 0.5% Cut In September
Portfolio Pulse from Piero Cingari
Disappointing labor market data has led to a significant shift in interest rate expectations, with traders now anticipating a total of 1.25% rate cuts by year-end. The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) surged 2.8% in response. Economists from major banks have revised their rate cut forecasts, with some expecting larger cuts in the upcoming Federal Reserve meetings.
August 02, 2024 | 7:26 pm
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The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) surged 2.8% following disappointing labor market data and increased expectations for significant rate cuts by the Federal Reserve.
The sharp rally in U.S. Treasury bonds, particularly in longer-dated maturities, directly benefited TLT, which tracks these bonds. The increased probability of significant rate cuts by the Fed has made long-term bonds more attractive, driving up TLT's price.
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