Traders begin betting on a 50 basis point rate cut by the Fed in September

On July 15th, bond traders are increasing their bets, believing that the Federal Reserve will cut interest rates by 50 basis points in September, rather than the standard 25 basis points. Marilyn Watson, Head of Global Fundamental Fixed Income Strategy at BlackRock, said that the Federal Reserve is likely to cut interest rates in September. However, she also believes that the Federal Reserve may take action early in July. Futures open interest data from CME Group Inc. showed that buying volume on Thursday last week was close to 260,000 contract highs in October. Buying interest remained high on Friday. Any buying at higher prices implies an expectation that more people will believe that the Federal Reserve may begin its first easing cycle in years with a large-scale move.