Gold Finance reported that bond traders are now more likely to believe the Federal Reserve will cut interest rates by 50 basis points at this week's meeting, rather than 25. Futures contracts tied to the Fed's interest rate decision show a greater than 50% chance of a 50 basis point rate cut this week. Last week, traders almost completely ruled out this possibility. This has pushed the two-year US Treasury yield to its lowest level in two years and dragged the US Dollar index to its lowest level since January.

Philip Marey, senior US strategist at Rabobank, wrote that he expects the Fed to implement a standard 25 basis point rate cut. "Powell's lack of guidance could indicate that the FOMC has not yet reached a consensus. More importantly, Tuesday's retail sales could still shift market expectations." (Gold Ten)