Home https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ Business https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ The hawk feeding bet creates news in a key part of the price market

The hawk feeding bet creates news in a key part of the price market



The building of the Federal Reserve of Marriner S. Eccles.

Photographer: Andrew Harer / Bloomberg

In the corner of the US interest rate market, which is most in line with Federal Reserve policy, a bet has emerged that will provide a nice profit if traders increase the time they expect the next tightening cycle to begin.

Trading takes place through Eurodollar futures options and has been growing in size over the last week. The increase coincides with opinion polls suggest a growing chance of the White House’s democratic scope and the Congress of Elections on November 3. For many investors, this scenario would pave the way for a significant fiscal spending package, potentially accelerating the economy’s rebound from the pandemic and causing inflation to accelerate towards the Fed’s target.


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