FED: Fed's Cook Vows To Stay On As Fed Governor

• RES 3: 97.190 - High May 5 2023
• RES 2: 96.932 - 76.4% of Mar-Nov ‘23 bear leg 
• RES 1: 96.860 - High Apr 07
• PRICE: 96.630 @ 16:49 BST Jul 21
• SUP 1: 95.900 - Low Jan 14  
• SUP 2: 95.760 - Low 14 Nov ‘24
• SUP 3: 95.480 - Low Jan 11 2023 and a major support

Aussie 3-yr futures traded strong to start the week, buoyed by a global rally in core bonds. This again challenges resistance at 96.730, the Sep 17 ‘24 high, leaving 96.860 as the next key level. Instead, a continuation lower would strengthen a bearish theme. This would refocus attention on 95.760, the 14 Nov ‘24 low. Conversely, a reversal higher would refocus attention on 96.860, the Apr 7 high.

Futures-implied Fed funds rates were little changed Monday. Despite a decent move further down the curve (10Y yields -4bp), the short-end remained relatively anchored as the prevailing narrative remained of the FOMC maintaining its projected course of roughly 2 rate cuts by year-end (Dec pricing = 46bp, unch from Friday). There's about 100bp of cuts still priced through the next year.

• There's still understandably almost no chance of a July rate cut (under 4% priced) with the biggest drama probably being whether there are zero, one, or two dissents to a hold; the first cut i still not seen coming until October (28bp, unch).
• Last week's drama over whether President Trump would fire Fed Chair Powell in the near future appears to have abated - the White House reiterated today that Powell wouldn't be fired, and as MNI's Policy Team reported, "Federal Reserve Chair Jerome Powell would likely prevail in court and get to serve out his term even if President Donald Trump goes through with threats of firing him, former Fed lawyer Cornelius Hurley told MNI." (MNI INTERVIEW: Powell Would Win In Court If Trump Fires Him).
• We get Fed speakers Tuesday (Powell and Bowman) but they are not permitted to deliver monetary policy comment, rather appearing as part of a conference on banking regulation.