Author

Pardip Bansal

regime

Seven Dissents. One Direction.

Three committees held inside seventy-two hours: the Fed 9-3, the Bank of England 6-3, the Bank of Japan 8-1. All seven dissents were votes for higher rates; not one member anywhere voted for a cut. September stayed majority-priced through soft US data, and the desk scores the week, error included.

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regime

The Fed Held. The Hawks Didn't.

The Fed held 3.50 to 3.75 on a nine-to-three vote: Hammack, Kashkari and Logan dissented for a rise and the statement named energy supply shocks. By evening a September rise was majority-priced at 60%, above anything July reached. A hold that leaves the next rise majority-priced is the ratchet.

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regime

FO Analysis: The Ratchet.

The market spent last week watching an energy shock round-trip: Brent settled through $100 as the war escalated, then surrendered nearly all of it to a weekend pause in the strikes. What did not round-trip was policy. The probability of a July rate rise tripled on the spike and held near three …

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regime

The Shock Round-Trips. The Floor Doesn't.

Crude spiked to Brent 100 on the war and gave it back when the weekend paused the strikes. The long end moved five basis points up, four back, and held the top of its band; rate-rise bets kept most of their move. The floor absorbed the shock both ways. The Fed decides Wednesday.

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