In Japan, quite a few YouTube channels are discussing whether the Fed could cut rates before year-end.
One thing they often point to is the comparison of the yield curves before and after the July FOMC meeting.
From what I saw:
Shorter-term nominal and real yields (around the 5–7 year part of the curve) fell slightly.
Longer-term real yields rose.
Inflation expectations moved a bit higher across the curve.
That made me wonder whether the market has started pricing in a slightly higher probability of year-end rate cuts, even though longer-term inflation and fiscal concerns remain.
One commentator even claimed that people are already discussing 50-year mortgages in the U.S. (I’m skeptical of that claim.)
What do you all think?
Do you expect the Fed to cut rates before the end of the year, or do you still think rates will stay where they are?