US Rates and Cross-Section

My read is that the short end yesterday got washed around by Warsh headlines, but the underlying rates story has not really changed. The market still wants to price cuts. The war keeps reintroducing inflation persistence. And the result is a noisy front end sitting on top of a curve that still wants to steepen. Warsh did not give the market a clean dovish handhold, he defended Fed independence and said he had made no promise to cut rates, while a the bell-end economists now sees the first Fed cut pushed back to late 2026, with nearly a third expecting no cut at all this year. That matters because it keeps the front end trapped between political noise, oil-driven (broader energy) inflation pressure and a market that still cannot quite let go of the easing story.