Eurodollar University Breaking Report Reveals SHOCKING Interest Rate Forecast
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Sep 24, 2025 Market predictions indicate the Fed may cut rates further, revealing a disconnect between their policies and underlying economic signals. Negative swap spreads suggest expectations for significantly lower short-term rates, while Goldman Sachs highlights the current yield curve mirroring past zero-rate environments. Jeff argues that the market's consensus for ultra-low rates stems from economic weakness rather than inflation. Lastly, he provides insights into the potential impacts on the 10-year yield, predicting it could settle around 2–2.5% amid strong market conviction.
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Markets Signal Fed Direction First
- Markets give clear signals the Fed is cutting and will cut again, long before policymakers admit it.
- Jeff Snider argues market signals beat mainstream econometric models for predicting rate moves.
Shelter Distorts Inflation Readings
- Fed officials publicly disagree because they lack understanding of the monetary system and current inflation drivers.
- Snider highlights shelter imputation as the main distortion in CPI and PCE inflation readings.
Negative Swap Spreads Forecast Low Rates
- Swap spreads are a relative forward measure that price expected short-term rates.
- Very negative swap spreads signal markets expect much lower short-term rates for a long time.