Fed funds futures traders now see an 82.3% chance of a 25-basis-point rate hike by the Federal Reserve in May after Governor Christopher Waller said policy makers need to keep raising borrowing costs. Such a move would take the fed funds rate target to between 5% and 5.25%. The odds of another quarter-point hike in June also jumped to almost 18%, as traders also pulled back on the extent of rate cuts they expect later this year, according to the CME FedWatch Tool. Treasury yields jumped, with the 2-year rate soaring 9 basis points to 4.08%.
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