Wall Street's First-Line Interpretation of the Fed Decision: September Rate Cut? Not So Absolute

This time, the Fed conveyed that it does not want investors to be certain of a 25 basis point rate cut in September, as more economic data will need to be considered before then.

The bond market is highly expectant, with traders fully pricing in three Fed rate cuts this year. Powell hinted at a rate cut as early as September. The unemployment and manufacturing data released on Thursday reinforced rate cut expectations, with the 10-year US Treasury yield falling below 4.0% for the first time since February.