Front page of the Financial Times - Fed to cut rates

Expectations are the Fed will be cutting by 25 basis points.

The FT reflecting those expectation on its front page.

The Federal Open Market Committee announcement is due July 31.

Expectations of a 50bp cut were raised by comments from New York Fed branch head John Williams last week, you may recall these during the US session Thursday:

• Fed's Williams: It is better to take a preventative approach than to wait for disaster

• US dollar weakens after dovish Williams comments

• Fed funds futures now pricing in at 59% chance for 50 bps cut in July

His comments were than wound back later by his officials:

• New York Fed says Williams' speech was not about potential policy actions at the July
• US dollar gaining points on New York Fed disavowing Williams
• The New York Fed wound back Williams comments at the most damaging time of the day - here's why

The USD was taken for a ride, first down on his initial comments, then back up again on the disavowal.

There have been convoluted arguments that it was all a cunning plan from Williams to soften us up for a 50bp cut. I am taking the Occam's Razor approach and saying, nope, he messed up. The RBA did something similar in 2017, these central bankers are not all powerful oracles (is this news to anyone?)

25bps it will be. Wednesday July 31 for the announcement, still a good way off.