Where is the confidence?/ZipRecruiter on the labor market and other good stuff

To repeat what I've said the last few days, how can any central banker have enough confidence that today is the day to cut interest rates again in light of all the confusing data, spike in bond yields along with a new president and after surprising many with a 50 bps cut a few months ago? Regardless, the Fed will likely follow what has been priced in and cut 25 bps but I do believe we have a high possibility that Powell walks back expectations for another one in December as he'll be more non-committal than the 72% odds priced in for the December 18^th gathering. 

The market has already walked back a bunch of rate cuts post September meeting. The day before the September meeting, the December 2025 fed funds futures contract was yielding 2.83%. Today it stands at 3.75%, thus taking away almost 100 bps of future cuts. 

Also for perspective, the 2 yr yield was at 4.36% the day before the July meeting where the minutes revealed some wanted to cut then and vs 3.55% the day before the 50 bps cut. Today it stands at 4.25-.26%. The move in the 10 yr yield, obviously dictated by the market instead, is even more stark. The yield was 4.14% on July 30^th and 3.62% on September 16^th vs 4.44% as of this writing and which is the highest since early July. 

I'll note today too that European bonds are selling off, especially after the Chancellor just axed his Finance Minister. The German 10 yr bund yield is at the highest since July 22nd, up 8 bps. The French 10 yr yield is up by a similar amount to the highest since early July. 

We remain I believe in a sovereign bond bear market after the 40 yr bull run. See below for the move in the JGB market. 

The Bank of England cut rates by 25 bps to 4.75% as fully expected but it was somewhat of a hawkish cut when you read the statement. The vote was 8-1 with the one wanting to keep rates unchanged. "There has been continued progress in disinflation, particularly as previous external shocks have abated, although remaining domestic inflationary pressures are resolving more slowly."

Interestingly too, the BoE talked about the new Rachel Reeves budget and how it could influence their growth and inflation estimates. I doubt Jay Powell will talk about Trump today, though we don't have his budget yet of course. 

Here was the go slow from here line, "Based on the evolving evidence, a gradual approach to removing policy restraint remains appropriate. Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further."