Fed Rate Cut in June? Data Throws Cold Water on Dovish Hopes

Market Overview Analysis by James Picerno covering: United States 2-Year. Read James Picerno's latest article on Investing.com

Forecasts that the Federal Reserve will start cutting interest rates in June took another hit after Monday’s relatively firm manufacturing survey data for March.moderate odds that easing will start at the end of the second quarter, but the incoming data is providing more support for again pushing the date for a dovish policy pivot further down the road.ticked above the neutral 50 mark in March, marking the first expansion for the sector since 2022.

Nonetheless, Fed funds futures are still anticipating a moderate probability that the central bank will start cutting in June. “I continue to think that the most likely scenario is that inflation will continue on its downward trajectory to 2% over time. But I need to see more data to raise my confidence,” says Cleveland Federal Reserve President Loretta Mester in prepared remarks yesterday . “I do not expect I will have enough information by the time of the FOMC’s next meeting to make that determination.”

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