Investors are betting big on the Federal Reserve cutting interest rates soon, and they’re putting their money where their mouth is. Last week, a whopping $17.69 billion was poured into global bond funds, with a huge chunk of that, $9.58 billion, going into US bond funds. This is the highest amount in six weeks.
US government bonds are particularly popular right now. Investors put $5.42 billion into them last week, the most since October 2022.
It’s not just bonds that are attracting investors. Money markets are also seeing a lot of interest, with $8.18 billion flowing in for the fourth week in a row. Gold and other precious metals are also on the rise, with $342 million flowing into those funds for the third week in a row.
Meanwhile, the stock market took a dip last week, losing about $2.83 billion. Bitcoin ETFs also saw outflows, losing $277.2 million over the last five days.
So, what’s driving all this investment activity? Many investors believe that the Federal Reserve will soon lower interest rates to help boost the economy. The CME’s FedWatch tool shows that 30% of market participants now expect a big rate cut of 50 basis points next month, while 70% expect a smaller cut of 25 basis points.
It’s important to remember that this is just speculation.
The Federal Reserve hasn’t announced any plans to cut rates yet. Investors should always do their own research and consult with a financial advisor before making any investment decisions. /p>
