Brexit May Delay a Fed Rate Hike, Here's Why

The transcript discusses the probabilities of Fed rate hikes and cuts, suggesting that a rate cut is unlikely and that quantitative easing might be preferred. It analyzes the potential for breaking the 10-year yield record and the impact of market volatility. The discussion also covers the implications of a UK ratings cut, opportunities in sovereign debt markets, and the divergence in European bond yields due to political and economic uncertainties.

What is the likelihood of a Federal Reserve rate cut in July?

• 0%

• 10%

• 50%

• 100%

What is the historical low for the 10-year yield that might be broken soon?

• 2.00% from January 2015

• 1.50% from March 2010

• 1.25% from June 2011

• 1.38% from July 2012

How might a ratings cut by a major agency affect the UK gilt market?

• It will cause a significant rise in rates.

• It will likely lead to a rally in gilts.

• It will cause a crash in the gilt market.

• It will have no impact at all.

Why is it challenging to find opportunities in sovereign debt currently?

• Because yields are very low or even negative.

• Due to high yields in the market.

• Because rates are expected to rise soon.

• Due to a lack of investor interest.

What is causing the divergence between core and peripheral bond yields in Europe?

• Political and economic uncertainty

• Economic certainty

• Stable political conditions

• High inflation rates