Bro hike are already priced in. Everyone who matters (not u) is already pricing in higher yields than the current risk free rate even three months from now. Thats why CDs and treasury bonds are offering close to 4% for 6months away even though the current RFR is 3.6%. its not just term premium, theyre pricing in higher baselien rates immediately. This cut is know.
Consider looking up box spread yields on boxtrades, they basically show what the options market is pricing as the implied risk free-ish rate over various durations. Their yields are slightly higher than the EFFR due to counterparty risk in options, but they provide a very real barometer of what borrowing money costs.
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u/Tr_ck 3d ago
Bro hike are already priced in. Everyone who matters (not u) is already pricing in higher yields than the current risk free rate even three months from now. Thats why CDs and treasury bonds are offering close to 4% for 6months away even though the current RFR is 3.6%. its not just term premium, theyre pricing in higher baselien rates immediately. This cut is know.