How Does the Fed Affect Markets?

Jun 21, 2022

By The Small Exchange

Overview

The Fed primarily affects the Fed Funds Rate - a short-term interest rate benchmark in the US - but action taken on this rate can have widespread effects on US Treasury rates of varying durations. Frank maps out the influence of the Federal Reserve over interest rate markets, and he speaks to how this activity can also affect the stock market.

Finally, Frank gives projections on where the Fed might be going with Fed Funds Rates in the future from futures prices on this instrument, and he shows you how to form an opinion on this projection before trading it in the interest rate futures market.

Contents

0:05 How Does the Fed Affect Markets?

0:35 The Fed Affect the Fed Funds Rate

2:30 Fed Funds Rate Futures

4:30 Treasury Futures

5:00 The Changing Yield Curve

6:20 The Trade NOW is What Will the Fed do NEXT.

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