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Traders keep bets against 2016 Fed rate hike after minutes

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Reuters
Last Updated : Jul 07 2016 | 12:01 AM IST

(Reuters) - U.S. short-term interest rate futures contracts pared losses slightly on Wednesday after the Federal Reserve released minutes of its June meeting that suggested policymakers want to wait to see the impact of Brexit before raising rates.

The price of futures contracts tied to the Fed's benchmark policy rate moves inversely to the rate that traders expect at any given point in time. The move in price suggests traders see an even slimmer chance the Fed will raise interest rates this year.

Within minutes of the release of the minutes, fed funds futures contracts for most maturities were at the same levels as prior to the release, suggesting traders saw just a 19 percent chance of a rate hike by December.

(Reporting by Ann Saphir; Editing by Leslie Adler)

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First Published: Jul 06 2016 | 11:54 PM IST

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