US05Y : Still standing
It all seems that the 30s, 10s and 07s had all fallen below the EFFR.
Now, it is the turn of the 05s. But I think it should also FALL soon.
The implication?
Looks like the Fed rate hike is coming to an END. If there is a further hike of 50bps next month as ANTICIPATED, this would potentially put ALL the yield curve below the EFFR. And that might be a POLICY error that many are saying the Fed is committing.
The Dollar will likely FALL.
The Euro will likely rise. Of course, this rise is subject to the ongoing WAR in Ukraine. If it does not stop by the 2Q2023, we shall see what is in store for the entire EZ. The EZ budget is already stretch to the limit because of the policy of 'energy suicide'. It things continue as it is, the EU economy will completely collapse. Industry will shutdown, euro in free fall, inflation and debt will rise.
Good luck. And have a nice weekend :)
P/S : As always, do not just believe what I say. Use your common sense.
Now, it is the turn of the 05s. But I think it should also FALL soon.
The implication?
Looks like the Fed rate hike is coming to an END. If there is a further hike of 50bps next month as ANTICIPATED, this would potentially put ALL the yield curve below the EFFR. And that might be a POLICY error that many are saying the Fed is committing.
The Dollar will likely FALL.
The Euro will likely rise. Of course, this rise is subject to the ongoing WAR in Ukraine. If it does not stop by the 2Q2023, we shall see what is in store for the entire EZ. The EZ budget is already stretch to the limit because of the policy of 'energy suicide'. It things continue as it is, the EU economy will completely collapse. Industry will shutdown, euro in free fall, inflation and debt will rise.
Good luck. And have a nice weekend :)
P/S : As always, do not just believe what I say. Use your common sense.
تعليق:
Now, the 5s seems to be permanently BELOW the previous EFFR @ 3.830%.
It reacted 'strongly' to the 12/2022 FOMC 'rate hike' of 50bps; going down further. This is a strong statement from the Bond Market. It is doubling DOWN against the Fed.
It reacted 'strongly' to the 12/2022 FOMC 'rate hike' of 50bps; going down further. This is a strong statement from the Bond Market. It is doubling DOWN against the Fed.
It seems like the ECONOMY is not looking good.
A really BIG recession is on the HORIZON.