⚖️🇺🇸 Fed Dovish Pivot Bets Trimmed Heading into Jackson Hole
- Rosbel Durán
- Aug 23, 2022
- 1 min read
Expectations that the Fed will express a dovish pivot have been reduced, the spread between the SOFR Dec.22-23 now ticks at -25bps, compared to -62bps in late June
A Bloomberg piece noted that hedge funds have been building up a short position on rates markets as they expect the Fed will hold its tightening path, this is despite mixed data from the prices and the labour fronts
COT data showed SOFR futures net shot positioning increased to 695.5K contracts, while Eurodollar shorts jumped to 2.6M, the highest this year, Bloomberg said
As of today, SOFR spreads signal a 25bps rate cut from the Fed is priced in for next year
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