Like short-term CDs, the yields of 4-week T-Bills are also declining prior to next week’s Fed meeting. As listed in Kirkland’s “Highest Brokered CD Rates As Of 9/11/2024” post, 5.381% was the investment rate of the 4-week T-Bill from the Treasury auction 5 weeks ago (8/8/2024). 5.053% is the investment rate of the 4-week T-Bill from today’s Treasury auction.
https://www.treasurydirect.gov/instit/annceresult/press/preanre/2024/R_20240912_2.pdf
If officials think about which mistake they are less likely to regret at this week’s meeting, the case for starting their rate-cutting cycle with a half-point move makes sense, said Robert Kaplan, who served as Dallas Fed president...“If I were in my old seat, I’d say, ‘I could live with 25, but I’d prefer 50,’ ”...“If I started with a clean sheet of paper, I’d say rates should be at 4.5%-ish.”
Fed officials aren’t likely to regret a larger rate cut this week if the economy chugs along between now and their next meeting, in early November, because rates will still be at a relatively high level, he said. But if the Fed makes a smaller move and the labor market deteriorates more rapidly, officials will feel greater regret.https://www.wsj.com/economy/central-banking/fed-interest-rate-cut-size-79a238ca?st=uufd5n&reflink=de...