The December 2020 Fed Funds futures contract is trading in negative territory
The White House's economic advisor Hassett is on the wires now saying him
- If the Fed decides push interest rates negative, he would supported
- He would not advise Fed to do anything
- Respects Fed's independence
recall from yesterday that the January 2021 Fed funds contract traded above 100 implying a negative interest rate. Today, the December 2020 contract is trading at 100.015, also implying a negative interest rate.
Although some Fed officials have said that they don't see negative interest rates, the market is definitely moving that way. In addition to the creep of the Fed funds contracts toward 100.00 level, the 2 year treasury yield traded as low at 0.111% today (another record).
Below is the table of the Fed Funds futures contract. The November and October contract are very close to the 0.00% level (at 100.00).
