Markets Bet Against Central Banks on Rate Cuts, Risking Even Higher Rates
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Rate-cut bets keep piling up even as central banks signal they will keep rates high. This could trigger rate hikes instead of cuts.
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Markets are betting against central banks, causing financial conditions to loosen when central banks want to tighten.
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ECB's Wunsch warns rate-cut bets could force a rate hike to get conditions tight enough.
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The Fed's financial conditions index shows continued loosening to the easiest since before rate hikes started.
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Central banks face markets fighting them instead of cooperating, risking even higher rates for even longer.