Let's take a look at how the odds for the May decision have changed since two weeks back:
- 27 March: No change (85%), +25 bps (15%)
- 29 March: No change (59%), +25 bps (41%)
- 31 March: No change (42%), +25 bps (58%)
- 5 April: No change (58%), +25 bps (42%)
- 7 April*: No change (29%), +25 bps (71%)
- 11 April: No change (33%), +25 bps (67%)
*after the US non-farm payrolls
And as mentioned countless times since then, the shift in pricing is definitely no coincidence to the story in the bond market - where we are seeing 10-year Treasury yields continuing to hold above the key threshold around 3.30% for now.
In turn, we have also seen the dollar be brought towards the edge before finding a bid again after the jobs report on Friday last week.
As such, it's all about the Fed outlook right now and expect the volatility to continue as we gear towards the key risk events lined up for this week here.
