Citigroup: Skipping interest rate cuts in December by the Federal Reserve is attractive

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BlockBeats News, on November 6th, Citigroup analyst Jabaz Matai said that betting on the Fed not cutting rates again in December is attractive given the current market odds. The market widely expects the Fed to cut rates by 25 basis points this week, but given a recent series of strong economic data, this could be the Fed’s last rate cut of the year. His latest report suggests a swap trade, where traders agree to pay a fixed annualized interest rate of 4.404% and receive interest that floats with the Fed’s target interest rate. If the Fed doesn’t cut rates in December and keeps the interest rate between 4.5% and 4.75% by the end of the year, this trade will yield returns. (FX678)

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