Bond traders begin to bet on a significant move by the Federal Reserve to cut interest rates by 50 basis points in September

ChainCatcher news, according to Caixin, bond traders are increasing their bets that the Federal Reserve will cut rates by 50 basis points in September, rather than the standard 25 basis points. This is fully reflected in the federal funds futures market.

The inflation data released on Thursday was weaker than expected, triggering a buying frenzy for October, which continued on Friday. Contracts expiring on October 31 have fully priced in the expectation that policymakers will cut rates by 25 basis points at the meeting on September 18. Any buying at higher price levels suggests that more people believe the Fed may initiate a "big move" to start the first easing cycle in years.