I think the battle lines are being drawn between the Jay Powell "mid-cycle adjustment" believers and the rates are going to zero fans. The next 4 weeks are probably crucial. If the economic evidence is that the CEO Survey is right, then the Fed are behind the curve...
But maybe the SPX is leading and the business cycle is in for a renewed up phase (either a full one or a mini-cycle), then Eurodollar interest rates futures might be forming a head and shoulders top... this is the risk to my view.
But only time will tell. I err on the side of this being yet another opportunity to buy bonds but Im extremely cognisant of the risk, so have reduced exposure until clarity comes. Either way, whatever happens now will likely set the tone for the next 3 months.
You can follow @RaoulGMI.
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