Euro$ interest rate futures are feeling their oats
Euro$ interest rate futures are feeling their oats in contrast to stocks, as the Fed/rate outlook relaxes. The December 2018 contract is 0.75 ticks firmer near 97.2725 (2.7275% implied 3-month yield), while the deferreds are 2.0-4.5 ticks higher out the curve. December Fed fund futures are a half-tick firmer near 97.725, while 1.0-5.5 higher out the curve. The December 2019 contract at 97.29 (2.71% implied), suggests a 34% chance of 2 rate hikes in 2019 from 38% on Friday. Near-term Fed funds show a 65% chance for a December hike from 69% on Friday. NY Fed's Williams remained optimistic on the economy and low unemployment in earlier remarks, leading to further gradual hikes, but also said the Fed is "not on a pre-set policy course."