Traders still expect the Fed to make at least two big rate cuts in the near future

Odaily Odaily News: Traders in the U.S. interest rate options market are still betting that the Federal Reserve will make at least one super-large rate cut this year, but it may not happen before the U.S. presidential election on November 5. Recent options activity related to the secured overnight financing rate shows that traders are increasingly positioning for a rate cut of about 150 basis points before the Fed's January 29 policy decision. This is the same as the current situation in the swap market. To achieve this, without inter-meeting rate cuts, policymakers must implement at least half a percentage point cuts in two of the four meetings before January. (Jinshi)