The yield on the 10-year benchmark ended at 6.4885%, after closing at 6.5139% on Thursday. The yield rose marginally on the week, after climbing 2 basis points last week. Yields move inversely to prices. The Federal Reserve reduced interest rates by 25 bps and indicated 50 bps of more cuts in 2025. However, Chair Jerome Powell said the Fed will be in a "meeting-by-meeting situation" regarding the rate cut outlook, and framed the move as a risk-management cut. This indicates that the rate cut cycle may not ...

Federal Reserve Outlook - The Federal Reserve is expected to announce a 25 basis point cut in interest rates, with traders closely monitoring comments from Fed Chair Jerome Powell for indications of future cuts [1][7] - There is a consensus that the Fed will initiate a cutting cycle, with expectations of one cut per meeting moving forward [3][10] - The tone of the Fed's communication is anticipated to be dovish, indicating a shift towards a more neutral stance in response to recent economic data [12][14] Market Reactions - The market has priced in the expected rate cut, and historical patterns suggest that such events often lead to continued upward movement in asset prices [21][22] - Retail investors have been accumulating risk, while institutional investors have been slower to re-risk, potentially leading to a supportive environment for equities [22][23] - The long end of the treasury market may not see significant rallies, as the initiation of the cutting cycle could limit demand for long-duration bonds [19][20]