[Hong Jang-won's Bull & Bear] Long-term yields have finally fallen; their future now hinges on this
- What to look for
- You can follow the process of assessing whether there will be a December (month 12) increase by connecting Paedeuwochi [unclear caption] probabilities, Fed officials' remarks, and Treasury auction results.
- Why it matters
- Learning to read remarks alongside conditions such as voting rights and auction demand, rather than relying on a single statement, can help distinguish market expectations from actual triggers in interest-rate news.
AI summary
The video examines the Federal Reserve outlook, focusing on a market leaning toward a December (month 12) rate increase and President Daly's conditional view that tightening could end. Paedeuwochi [unclear caption] shows an over 80% probability of no change in October (month 10) and leans toward an increase in December (month 12). It reports that the baseline scenario is to watch the effects of the September (month 9) increase and raise rates once more at year end. It says Daly was the first within the Fed to explicitly state that tightening could end with the September (month 9) increase if the tariff, oil-price, and AI shocks are temporary, broadening the debate to whether an increase will occur in December (month 12). However, it adds that Daly has no vote and also expressed concern about longer-term inflation driven by AI and data centers, while Schmid reaffirmed his support for further tightening. Oil prices moved sideways amid a recovery in the Gulf and uncertainty surrounding Hormuz, while the 10-year yield closed slightly lower. The auction of 3-year securities worth 580 hundred-million performed reasonably well, clearing below the previous yield, and the S&P500 reached a new high. It says the results of the main event—the 10-year and 30-year auctions—still need to be watched. All directional outlooks are the speaker's conditional judgments, not definitive predictions of short-term prices.