Sunday, July 7, 2013

Implied rate hike date moves to October of 2014

The Fed Funds futures curve steepened again on Friday, bringing forward the implied date of the first rate hike by the Fed.

Fed Funds futures curve shift as a result of Friday's employment report 

The date is now closer to October of 2014 as opposed to May of 2015 discussed about a month ago (see post) - an immense steepening in such a short time. That means the market now expects the current securities purchase program to end before the start of the fourth quarter of 2014.
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