The SOFR Surge: Why the Market is Tightening Before the Fed Even Cuts
A sudden jump in a critical lending benchmark signals a liquidity crunch that could undermine the central bank's next move.
As the Fed prepares to potentially cut rates, a sudden surge in a key lending benchmark signals that liquidity is tightening, not easing.
The machinery of modern finance is complex, but sometimes it sends a signal too loud to ignore. That happened today as the Secured Overnight Financing Rate (SOFR) broke out sharply to 4.51%, a significant jump from 4.4…