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Strategies & Market Trends : Sharck Soup -- Ignore unavailable to you. Want to Upgrade?

To: golfnut777 who wrote (28610)	6/19/2001 12:51:48 PM
From: $Mogul	Respond to of 37746

It's all about Fed funds futures my freind.

To: golfnut777 who wrote (28610)	6/19/2001 12:51:56 PM
From: $Mogul	Read Replies (1) \| Respond to of 37746

It's all about Fed funds futures my freind, and they now are pricing it in. FED TALK: Fed easing expectations continue to climb ahead of the June 26/27 FOMC meeting. The July Fed Fund futures contract is trading at a rate of 3.635%, reflecting a little less than a 50% chance the Fed cuts rates 50 basis points rather than the 25 bps cut that has long been factored into the market. And the August contract is trading at 3.52%, indicating about a 90% chance that the Fed will cut rates by 50 basis points by the August meeting, which also reflects higher expectations for the June meeting. Expectations for 50 bps rose every day last week and continue to build despite reports Friday and in today's Wall St. Journal noting that less than half of the 12 regional Fed presidents requested a 50 basis point cut in the discount rate prior to the May 15 FOMC meeting. But the outlook was more optimistic in mid-May. After the May 15 rate cut, the market wasn't even fully pricing in another 25 basis point cut at next week's meeting. And while U.S. economic data took a turn for the worse, both the European Central Bank and Bank of Japan have also reduced forecasts for their own economies. Just today, the BOJ again downgraded its outlook. That comes after the Fed noted weakness in the international economy in the statements that accompanied both the April and May easings.