By Kim Khan
Investing.com – The market believes that there’s a slight chance the Federal Reserve could send interest rates into negative territory as early as July, fed funds futures showed today.
There was a 0.4% chance of rates being in the range of 0 to -0.25% after the Federal Open Market Committee’s July meeting, according to Investing.com’s Fed Rate Monitor Tool.
The most likely scenario is that rates will be between 0.25% to 0.5%, with a half-point cut fully priced in for the meeting this month, according to the futures.
Goldman Sachs (NYSE:GS) said today it sees rates moving to 0% to 0.25%, lows not seen since 2015.
Treasury yields plunged again today as money poured out of risk assets and into bonds. The full Treasury yield is now below 1%.
President Donald Trump has consistently called on the Fed to move rates into negative territory, in line with the European Central Bank. Trump said at the World Economic Forum in Davos, Switzerland that he likes the idea of getting paid to borrow money.
Market Sees Slight Chance of Negative U.S. Rates for July
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