Dollar Rate Repricing Swings From Four Cuts to Four Hikes

The dollar often falls when a Fed tightening cycle begins, even as front end U.S. yields climb into the first hike, as they have since 1994. David Scutt, StoneX Media Senior Market Analyst, works through six modern Federal Reserve tightening cycles and what each one did to front end yields and to the U.S. dollar. Markets have swung from pricing multiple rate cuts to pricing around four hikes out to the middle of next year, lifting the U.S. two-year yield into the expected first move. The 1994 and 1999 cycles stand out because the Federal Reserve began close to neutral, and in both the two-year kept rising while the dollar index weakened. The short-term correlation between the two now sits near historical extremes, though it has been asymmetric. Discover Actionable Insights with the latest Market Outlook Reports: https://intel.stonex.com/offer?language=en&campaignId=A908C315-DC62-4F35-AC16-870BB71E84D1&utm_source=youtube&utm_medium=social&utm_campaign=sxtv_guest_david_scutt&utm_content=share 00:00 - Four Cuts Become Four Hikes 00:27 - Six Fed Cycles Since 1994 01:03 - Front End Yields Move First 02:13 - The 1994 and 1999 Blueprint 03:12 - Dollar Link Near Extremes 04:06 - Where the Dollar Turns Next Like this video? Subscribe and turn on notifications so you don't miss any videos from StoneX: https://www.youtube.com/@stonex_official Visit https://www.stonex.com/en/insights/thought-leadership/?utm_source=youtube&utm_medium=social for insights, perspectives and thought leadership from StoneX's global network of experts. Visit our website: https://www.stonex.com?utm_source=youtube&utm_medium=social #StoneX #Forex #FederalReserve #DavidScutt