Rate Cut Coming – ValuePlays

Despite Fed protestations of continued inflationary pressure, the Discounted T-Bill Rate(DTB3) is being driven lower. Should DTB3 drop to 3.58% or lower, the Fed will follow through with another 0.25% cut to that level. The current level is close to 3.65% and may even close at that level today.

The market determines rates for the most part over the history of Fed Funds adjustments. The one exception was the early 1980’s when Chair Paul Volcker forced rates higher to quash an inflationary spiral.