🚨 FED RATE HIKE NOW LIKELY!?
Markets pricing 85%+ chance of 25bps hike this week. First hike in ~3 years.
25bps = already priced in
But here's the wrinkle:
Trump hand-picked Kevin Warsh. You really think he'd nominate someone who'd hike rates RIGHT BEFORE midterms? That's political suicide.
If Warsh got the nod, "no hike before midterms" was probably the handshake deal.
So are we really supposed to believe his guy pulls the trigger now?
Maybe the "obvious" trade is a trap. Risk/reward says fade the consensus here.
Markets pricing 85%+ chance of 25bps hike this week. First hike in ~3 years.
25bps = already priced in
But here's the wrinkle:
Trump hand-picked Kevin Warsh. You really think he'd nominate someone who'd hike rates RIGHT BEFORE midterms? That's political suicide.
If Warsh got the nod, "no hike before midterms" was probably the handshake deal.
So are we really supposed to believe his guy pulls the trigger now?
Maybe the "obvious" trade is a trap. Risk/reward says fade the consensus here.
