Expected Fed Funds Rate

Expected Fed Funds Rate as of September 13, 2019 Fed funds futures for January 2021 imply an expected rate of only 1.28%. Click the Picture to Enlarge

Small Bank Lending and 2-Year/Fed Funds Spread

Small Bank Lending and 2-Year/Fed Funds Spread This chart shows the correlation between small bank lending and falling rates, and the negative effect of an inverted yield curve on small bank lending. Picture source: TS Lombard

Fed Funds Rate Leads Money-Market Fund Inflows

Fed Funds Rate Leads Money-Market Fund Inflows The chart suggests that Fed funds rate leads money-market fund inflows by two years. Money-market fund inflows stop when risk becomes attractive again. Picture source: Oxford Economics, Macrobond

Fed Funds Target Rate and VIX

Fed Funds Target Rate and VIX Is more volatility expected ahead? This great chart suggests that the Fed funds target rate leads VIX by 2 years. You may also like “VIX is in a Transitory State” and “The Yield Curve Leads Volatility by Three Years.” Picture source: Bloomberg, Jeffrey Kleintop

Fed Funds Rate vs. S&P 500

Fed Funds Rate vs. S&P 500 This chart suggests that the Fed funds rate leads the S&P 500 by 1 to 3 years since the 1990s. Picture source: Wells Fargo Investment Institute

Forward Performance Following First Fed Funds Rate Cuts

Forward Performance Following First Fed Funds Rate Cuts After first Fed rate cut, the S&P 500 performance is quite attractive on average when no recession. You may also like “Dow Jones Industrial Average Around First Fed Rate Cut.” Picture source: Strategas