Fed-funds futures traders now see a 40.2% chance of another quarter-of-a-percentage-point rate hike by the Federal Reserve in June, after Dallas Fed President Lorie Logan said in prepared comments that the data doesn’t yet justify a pause next month. The likelihood of a June rate hike jumped from 28.4% a day ago, according to the CME FedWatch Tool. Meanwhile, traders also see a 39.4% likelihood that the Fed will leave the fed funds rate target between 5.25%-5.5% in July, assuming that a June hike happens. Treasury yields jumped, led by the 1-month rate, which rose 9 basis points to 5.53%, according to FactSet.
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