It’s another day of happy price action as markets reboot after September’s losses and the RBA delivered a lower-than-expected 25 bps rate hike. This has obviously spurred hopes that other central banks, most notably the FOMC, will also modulate their pace of braking, though for now pricing for the Fed funds rate through the end of the year hasn’t really changed. Instead, it’s next year where the rate volatility is. June eurodollars have executed a 50-bps round-trip from 95.50 to 95.00 and back, and after briefly pricing out any rate cuts next year the Dec 22/Dec 23 spread has swiftly returned one-and-a-half 25 bps ... (full story)