The expectation of a Federal Reserve interest rate cut has risen, with an 80% probability of a rate cut in December

According to Jinshi reports, investors are increasing their bets that the Federal Reserve will cut interest rates again at next month's rate decision, eliminating doubts from last week and paving the way for a rise in U.S. Treasuries. The open interest in futures contracts linked to the Fed's benchmark rate surged in the past three trading days, with market pricing showing an approximately 80% probability of a 25 basis point rate cut at the Fed's December meeting. This shift in expectations began with the delayed release of the September employment data last week, where New York Fed President Williams indicated that there is "recent" room for rate cuts amid a weak labor market.