The market withdraws its expectations for the Federal Reserve to cut interest rates this month, Morgan Stanley, Citigroup, and Barclays delay their interest rate cut forecasts

According to foreign media reports, bond traders have withdrawn their expectations for a rate cut by the Federal Reserve this month, as the unemployment rate in the U.S. fell more than expected in December last year. The yield on the two-year U.S. Treasury bond, which is sensitive to interest rates, rose nearly 5 basis points to 3.54%. Traders maintain expectations for two rate cuts by the Federal Reserve this year, with the first cut expected around mid-year, after the current Federal Reserve Chairman Jerome Powell's term ends, and the second cut anticipated in the fourth quarter. According to interest rate futures from the Chicago Mercantile Exchange, the market expects only a 5% chance of a rate cut by the Federal Reserve this month, with a probability of over 70% for a cut in June this year.

Morgan Stanley has pushed back its forecast for two rate cuts by the Federal Reserve from January and April to June and September; Barclays has delayed its two rate cut forecasts from March and June to June and December. Citigroup has canceled its prediction for a rate cut by the Federal Reserve this month but expects a quarter-point cut in March, July, and September.

The market is focused on the U.S. inflation data to be released this week, as well as the U.S. Treasury's auction of three-year and ten-year Treasury bonds, which is the first of this year. Additionally, the U.S. Supreme Court's ruling on President Trump's tariffs has also become a focal point, as investors are concerned about the impact on U.S. finances if the tariffs are overturned