Fed fund futures turn negative, BoE talks UK back to 1706

Friday 8th May 2020

Future contracts for Fed funds turned negative overnight for the first time. NAB’s Gavin Friend explains what’s happening. Is the Fed expected to move to negative interest rates soon?  The Bank of England didn’t budge on their stimulus activity, but could well next time. Meanwhile they’ve outlined various scenarios for the UK economy, one seeing a contraction of 14% this year, the most since 1706. Today we’ll see the scenarios envisaged by the RBA. And equity markets seem buoyed again by the hope that the economy will bounce back, helped by China’s balance of trade figures yesterday. Plus, of course, some sectors are benefiting from the lockdown.

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