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Market Extra: Traders, undeterred by December’s lousy job gains, continue to price in `sooner and faster’ tightening by Federal Reserve

Market Extra: Traders, undeterred by December's lousy job gains, continue to price in `sooner and faster' tightening by Federal Reserve

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Rates traders are continuing to price in the prospects of an aggressive start to the Federal Reserve’s next rate-hike cycle in coming months, despite Friday’s release of a disappointing 199,000 jobs gain for December. After the jobs report was released, futures reflected a 68% chance of a 25 basis point hike in March and 27% likelihood the fed funds target rate will be 50 basis points higher than it is now by the Fed’s May meeting, according to CME’s FedWatch tool.

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