BlockBeats news, on March 12, bond traders no longer fully priced in expectations of a Fed rate cut in 2026. Interest rate swaps tied to Fed policy meeting dates showed that traders on Thursday expected only a 24-basis-point cut this year—less than a full 25-basis-point cut—down from around 30 basis points anticipated Wednesday evening. This shift comes as U.S. Treasuries continue to decline, with the two-year yield, most sensitive to Fed policy changes, rising 4 basis points to near 3.70%. U.S. Treasuries have faced pressure this week as investors worry that the Middle East conflict will continue pushing up energy prices, reigniting inflationary concerns. (Jin10)
Market No Longer Fully Priced in Fed Rate Cuts for 2026
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Summary
Risk-on assets posted modest gains as bond traders reduced expectations for a full Federal Reserve rate cut in 2026. On March 12, 2026, traders priced in only a 24-basis-point cut, down from 30 basis points earlier in the week. The two-year Treasury yield rose 4 basis points to 3.70%. Market movements followed concerns that the Middle East conflict could push energy prices higher, complicating CFT efforts and inflation control.
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