0714 GMT - The downward correction in market pricing of the terminal Fed funds rate--where the Federal Reserve stops cutting interest rates--can continue a bit longer, says Danske Bank Research's Asger Wilhelm Dalsjoe in a note. Recent weak U.S. data have prompted money markets to lower bets on the terminal Fed rates. "We think the downward correction can proceed a bit longer, as we target a terminal rate of 3-3.25%," the assistant analyst says. Markets currently price the terminal Fed rate at around 3.50% to be reached in the second quarter of 2026, according to LSEG data. The 10-year U.S. Treasury yield, closed 6 basis points lower at 4.229% on Friday, currently trades 0.6 basis point higher at 4.235%, according to Tradeweb. (emese.bartha@wsj.com)
(END) Dow Jones Newswires
March 03, 2025 02:14 ET (07:14 GMT)
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