Federal Reserve's Interest Rate Cut in 2024: What Investors Need to Know
The Federal Reserve is considering cutting interest rates in 2024.
Treasury yields fluctuated on Friday as investors tried to parse the latest labor market data.
The Federal Reserve's decision to cut interest rates in 2024 is being closely watched by investors, with treasury yields fluctuating on Friday as they tried to parse the latest labor market data. While some analysts are predicting a quarter-point policy rate decrease in March, others believe that the Fed may not act until later due to uncertainty about its next move. Meanwhile, New York's attorney general has filed a lawsuit against former President Donald Trump for alleged fraudulent business practices.
Treasury traders are standing firm behind wagers that the Federal Reserve will cut interest rates sharply in 2024
Swap contracts tied to Fed meeting dates are again pricing in almost six quarter-point cuts and see a more than 70% chance of a quarter-point policy-rate decrease in March.
The yield on the 10-year Treasury was up 4 basis points at 4.034%, crossing back above the key 4% level.
Accuracy
Treasury traders are standing firm behind wagers that the Federal Reserve will cut interest rates sharply in 2024, even as a bunch of employment and service-industry data whipsawed yields Friday.
Deception
(50%)
The article is deceptive in several ways. Firstly, the author uses sensationalism by stating that 'treasuries plunge' when it is not entirely accurate as yields have only slightly decreased. Secondly, the author implies that job creation and wage growth are directly related to interest rate cuts which may not be true as other factors such as inflation also play a role in monetary policy decisions. Lastly, the article uses selective reporting by focusing on swap contracts tied to Fed meeting dates while ignoring other indicators of economic health.
'treasuries plunge'
Fallacies
(100%)
None Found At Time Of
Publication
Bias
(100%)
None Found At Time Of
Publication
Site
Conflicts
Of
Interest (50%)
There are multiple examples of conflicts of interest in this article. The author has a financial stake in the Bloomberg Terminal and is reporting on its performance.
The article mentions that 'treasuries plunge' after job creation data was released through the Bloomberg Terminal.
Author
Conflicts
Of
Interest (50%)
The author has a conflict of interest on the topic of Treasury traders as they are mentioned in the article and it is not clear if Liz Capo McCormick or Bloomberg Terminal have any financial ties to this group. Additionally, there is no disclosure of conflicts of interest.
The yield on the 10-year Treasury was up 4 basis points at 4.034%, crossing back above the key 4% level.
Treasurys Nonfarm payrolls data released Friday showed employers added 216,000 jobs in December.
Accuracy
No Contradictions at Time
Of
Publication
Deception
(30%)
The article is deceptive in several ways. Firstly, the title claims that the yield on the 10-year Treasury has 'swung back above 4%' when it had actually been below this level for some time. Secondly, the author states that yields and prices move in opposite directions which is not entirely accurate as they are both affected by various factors such as inflation expectations and interest rate decisions. Thirdly, the article quotes Deutsche Bank strategists who claim that a 25bp cut by March was down to 69% but fails to disclose any sources or evidence supporting this statement.
The title claims that the yield on the 10-year Treasury has 'swung back above 4%' when it had actually been below this level for some time. This is a lie by omission as no context is provided to explain what was happening before or after.
The author states that yields and prices move in opposite directions which is not entirely accurate as they are both affected by various factors such as inflation expectations and interest rate decisions.
Fallacies
(75%)
The article contains an appeal to authority fallacy by citing the opinions of economists and strategists without providing any evidence or reasoning for their beliefs. The author also uses inflammatory rhetoric when stating that a hot labor market could keep the Fed from cutting interest rates as early as expected, which is not necessarily true.
The yield on the 10-year Treasury was up 4 basis points at 4.034%, crossing back above the key 4% level.
Bias
(85%)
The article contains a statement that the yield on the 10-year Treasury was up at 4.034%, which is an example of monetary bias as it implies that higher interest rates are bad for economic growth.
Treasury yields moved in mixed directions on Friday as traders weighed the U.S. economic outlook following the latest nonfarm payrolls data release.
Site
Conflicts
Of
Interest (50%)
Katrina Bishop has a conflict of interest on the topic of Treasury yields and U.S. economic outlook as she is reporting for CNBC which owns Deutsche Bank strategists Jim Reid.
69% probability of a 25bp cut by March
Deutsche Bank strategist Jim Reid
Treasuries sold off across the curve.
Author
Conflicts
Of
Interest (50%)
The author has a conflict of interest on the topic of Treasury yields and U.S. economic outlook as they are reporting on Deutsche Bank strategist Jim Reid's prediction for a 25bp cut by March.
Trump is being sued by the New York attorney-general for alleged fraudulent business practices.
Accuracy
New York attorney-general seeks $370mn from Trump in fraud case
Deception
(0%)
The article contains multiple examples of deceptive practices. Firstly, the author is not disclosed in the body of the article which violates rule #1. Secondly, there are several instances where language is used to manipulate emotions rather than provide factual information such as 'Get ahead in 2024' and 'Save January'. Thirdly, there are multiple offers for subscription services that use misleading pricing tactics like '$39 $35 per month.' Fourthly, the article contains a statement about full terms and conditions which is not linked to any specific offer or service. Lastly, the article uses language such as 'Explore more offers' which encourages readers to click on links without providing clear information about what they will be clicking on.
The author of this article is not disclosed in the body of the text.
Fallacies
(0%)
The article contains an appeal to authority fallacy. The author cites the New York attorney-general as seeking $370 million from Trump in a fraud case without providing any evidence or context for this claim.
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Bias
(85%)
The article contains multiple examples of monetary bias. The author uses language that implies the Trump Organization is wealthy and successful, such as 'subscriptions' costing $39 or $75 per month. Additionally, the author mentions a potential financial gain for subscribers by saving 10% on standard subscriptions until January 10th.
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The return on a benchmark Treasury dipped below a key level as investors digested the labor market report.
Lower yields are good for new home buyers as they pull mortgage rates down.
Yields wavered on Friday as investors tried to parse a strong jobs market.
Accuracy
Treasurys Nonfarm payrolls data released Friday showed employers added 216,000 jobs in December.
Deception
(30%)
The article is deceptive in several ways. Firstly, the author states that lower yields are good for new home buyers as they pull mortgage rates down. However, this statement is misleading because it implies that lower yields directly result in a decrease of mortgage rates which isn't always true. Secondly, the author uses sensationalism by stating 'The return on a benchmark Treasury dipped below a key level.' This creates an emotional response and makes the reader think something significant has happened when it may not be entirely accurate. Lastly, the article is selectively reporting as it only mentions two specific yields while ignoring others that could also affect new home buyers.
Lower yields are good for new home buyers as they pull mortgage rates down.
Fallacies
(85%)
The article contains several fallacies. Firstly, the author incorrectly states that lower yields are good for new home buyers as they pull mortgage rates down. This is a false statement because lower yields do not necessarily mean lower mortgage rates and vice versa. Secondly, the author uses an appeal to authority by stating that economists expected 216,000 jobs to be added in December but fails to provide any evidence or context for this expectation. Lastly, the article contains inflammatory rhetoric when it states that yields wavered on Friday as investors tried to parse a strong jobs market.
Lower yields are good for new home buyers as they pull mortgage rates down.
Bias
(75%)
The article contains a statement that lower yields are good for new home buyers as they pull mortgage rates down. This is an example of monetary bias.
‘Lower yields are good for new home buyers as they pull mortgage rates down.’
