Search Results for: fed funds

Expected Fed Funds Rate Fed funds futures for January 2021 imply an expected rate of 1.27%. Click the Image to Enlarge

Fed Funds Rate and Neutral Rate Chart suggesting that the Fed funds rate is below the neutral rate. Image: Stifel

S&P 500 Trailing Price-to-Earnings Ratio vs. Real Fed Funds Rate Great chart showing the S&P 500 12-month trailing P/E ratio vs. the real Fed funds rate (R² = 0.79). Image: Stifel

Implied Probability of Fed Funds Rate in December 2020 The market thinks the Fed will cut rates below 1.75% by end of 2020, as the probability of recession increases. Image: J. Safra Sarasin

U.S. Yield Curve 1M to 30Y and Correlation Against Fed Funds Effective Rate According to the chart, a 75bp cut is required to normalize the term structure of interest rates. Image: Fundstrat Global Advisors, LLC

U.S. 10-Year/2-Year Yield Spread vs. Fed Funds Target Rate Interesting chart showing the U.S. 10Y-2Y yield curve steepness versus. the Fed funds target rate (inverted). Image: Credit Suisse

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. Image: TS Lombard

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. Image: Oxford Economics, Macrobond

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.” Image: Bloomberg, Jeffrey Kleintop

The GS Financial Conditions Index and The Target Fed Funds Rate The Goldman Sachs Financial Conditions Index is not at its lowest level and the current levels are quite similar than previous first rate cuts. Image: Bianco Research