(Bloomberg) — US Treasuries trimmed gains after the Federal Reserve reduced the number of projected interest-rate cuts this year to just one, leaving the central bank at odds with the market.
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Fed officials left their main policy-rate steady at a two-decade-high of 5.25% to 5.5% on Wednesday and forecast only a single quarter-point cut by the end of the year. Swap contracts that predict decisions by the US central bank, by contrast, still factored in rate reductions in November and December — while odds of a September move faded slightly from earlier in the session.
Speaking after the central-bank decision and forecasts, Fed Chair Jerome Powell said the actual path of rates would depend on future economic data. He said “we welcome” the cooler May inflation data released earlier Wednesday “and hope for more like that.” Still, Treasury yields rebounded slightly from their lowest levels of the session…
