4min chapter

The Macro Trading Floor cover image

The Real Stress Is Not In The US, But Elsewhere | Brent Donnelly

The Macro Trading Floor

CHAPTER

Is There a Fed Reaction Function?

The bond market is pricing looking at software futures or Eurodollar futures, basically 5% Fed funds all the way through the end of 2023. The ECB following the same kind of approach means European risk free rates at 3%. That's something that has been seen last time in 2007 in Europe. And also, if you look at short dated credit, like good stuff, double-erated, that's like 6% yields. So how does that change the mindset of an astalocator?

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