It is clear how unclear things are

In late December last year, financial markets anticipated 6-7 interest rate cuts by the Federal Reserve in 2024. US Fed Funds futures projected a drop in interest rates from 5.33% to 3.83% for the year. However, half a year later, these expectations have shifted dramatically. The market now predicts only 1-2 cuts, with the Fed rate expected to be at 4.96% by the end of 2024. The clear conclusion is that we lack clarity: while the trend toward rate cuts persists, the pace of these cuts remains highly uncertain. At ECP, we continue to avoid taking on excessive duration risk until we have more clarity.