Bond traders escalate bets on the Fed's half-percentage cut by the end of the year

Bond traders are stepping up bets on the Fed's interest rate cut by at least half a percentage point this year, and Fed officials are expected to start cutting interest rates by one quarter percentage point on Wednesday. Despite the persistence of inflation, a cooling of the labor market is prompting traders to hedge against the larger rate cuts that may occur in the context of worsening economic outlook.