Latest news with #MarkCabana
Bloomberg
3 days ago
- Business
- Bloomberg
Fed Portfolio Shift Could Hand Treasury $2 Trillion, BofA Says
A possible shift in the composition of the Federal Reserve's portfolio of Treasury holdings could result in the central bank buying nearly $2 trillion of bills over the next two years, enough to absorb nearly all of the Treasury's issuance during that period, according to Bank of America Corp. Strategists Mark Cabana and Katie Craig expect the Fed to adjust its portfolio to better match assets and liabilities in a move that will protect against interest-rate risk and negative equity while bringing down the duration of their liabilities. It would also end up being a much-needed windfall for the Treasury Department, which has been issuing billions of dollars in short-term debt to fund a growing deficit and replenish its cash balance following last month's increase of the debt ceiling.
Yahoo
5 days ago
- Business
- Yahoo
Data Not Supporting a Big Fed Rate Cut, BofA's Cabana Says
Mark Cabana, Bank of America Securities head of US rates strategy, says the markets are almost fully priced for a 25 basis-point Federal Reserve rate cut. He speaks with Vonnie Quinn on "Bloomberg Markets."
Bloomberg
5 days ago
- Business
- Bloomberg
Data Not Supporting a Big Fed Rate Cut, BofA's Cabana Says
Mark Cabana, Bank of America Securities head of US rates strategy, says the markets are almost fully priced for a 25 basis-point Federal Reserve rate cut. He speaks with Vonnie Quinn on "Bloomberg Markets." (Source: Bloomberg)
Yahoo
11-08-2025
- Business
- Yahoo
Bank of America lowers US rates outlook on weak data, Fed risks
(Bloomberg) — Interest-rate strategists at Bank of America (BAC) lowered Treasury yield forecasts in anticipation that recent economic data will drive a shift in the Federal Reserve's assessment of risks. Sunseeking Germans Face Swiss Backlash Over Alpine Holiday Congestion New York Warns of $34 Billion Budget Hole, Biggest Since 2009 Crisis Three Deaths Reported as NYC Legionnaires' Outbreak Spreads Chicago Schools' Bond Penalty Widens as $734 Million Gap Looms A New Stage for the Theater That Gave America Shakespeare in the Park Strategists led by Mark Cabana cut their year-end forecast for two-year yields to 3.5%, from 3.75% previously. They see 10-year yields at 4.25% by the end of December compared with the previous estimate of 4.5%. 'Recent US data has meaningfully shifted market Fed pricing and our view on US rates,' Cabana wrote in a note Monday. 'Fed independence erosion risk could see higher inflation tolerance and more low-rate champions, which factor into our thinking.' While Bank of America's economics team still expects the Fed to remain on hold until the second half of 2026, the rate strategists say soft labor market data has increased downside risks to interest rates. The appointment of Stephen Miran, an ally of President Donald Trump, as a Fed governor 'will likely further tilt the balance in favor of lower rates,' the strategists wrote. The strategists have recommended bets on five-year overnight index swaps to decline, targeting a move to 2.8% from 3.46% currently. They also favor 'adding duration on any rate back up' and expect breakeven rates –which reflect investors' inflation expectations— to widen. Interest-rate swaps show traders have priced in more than two rate reductions by December, with an about 80% probability of a quarter-point Fed cut as early as next month. While the market pricing for September 'is stretched,' the strategists said they are reluctant to fade it because there's a risk that the Fed may lower borrowing costs by 50 basis points, similar to what it did in September 2024 when policymakers started the monetary easing with a jumbo cut. Why It's Actually a Good Time to Buy a House, According to a Zillow Economist The Game Starts at 8. The Robbery Starts at 8:01 Klarna Cashed In on 'Buy Now, Pay Later.' Now It Wants to Be a Bank The Pizza Oven Startup With a Plan to Own Every Piece of the Pie Digital Nomads Are Transforming Medellín's Housing ©2025 Bloomberg L.P.
Bloomberg
11-08-2025
- Business
- Bloomberg
Bank of America Lowers US Rates Outlook on Weak Data, Fed Risks
Interest-rate strategists at Bank of America lowered Treasury yield forecasts in anticipation that recent economic data will drive a shift in the Federal Reserve's assessment of risks. Strategists led by Mark Cabana cut their year-end forecast for two-year yields to 3.5%, from 3.75% previously. They see 10-year yields at 4.25% by the end of December compared with the previous estimate of 4.5%.
