According to ChainCatcher, citing Wall Street News, analysts at Goldman Sachs' Fixed Income, Foreign Exchange and Commodities (FICC) division believe that a rate cut by the Federal Reserve at its upcoming December meeting is virtually a foregone conclusion.
Analysts point out that given the weak labor market and risk management needs, cutting interest rates at this time is the right policy choice, and the market has already fully priced in this expectation.
Williams' comments last Friday clearly indicated that there were enough votes within the Federal Open Market Committee (FOMC) to push for a rate cut. As a result, market pricing has rebounded to 21 basis points. With the Fed now officially entering its quiet period, market pricing reflects an 85% probability of a rate cut.
