Predicting the Fed's every move

Marketplace

American Public Media

Business, News

4.6 • 8K Ratings

🗓️ 26 November 2025

⏱️ 26 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Yields on government bonds can tell us how investors think the Federal Reserve will act. In this episode, we break down what falling yields on short-, medium- and long-term Treasuries tell us about where we’re headed. We also explain why people and firms across the economy bet on the Fed’s decision making. Plus: Jobs data paints a blurry picture of the labor market, PG movies dominate box office sales, and AI toys make their way to kids’ Christmas lists.

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Transcript

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0:00.0	On the program today, economic news the hard way.
0:07.0	We'll swing by the labor markets, and then we'll go to the movies, PG-only, please.
0:14.0	From American public media, this is Marketplace.
0:30.0	In Los Angeles, I'm Kai Rizzdahl.
0:33.7	It is Wednesday, today, the 26th of November.
0:35.3	Good as always to have you along, everybody.
0:38.3	Fair warning, right at the top of the program.
0:44.6	Today, the first six or so minutes are going to be a little bit dense information packed,
0:50.0	eating your economic vegetables, if you will, but in a good way, I promise. Stop number one is the government bond market, treasuries, because as I believe I've said, a time or two, stocks get
0:56.5	all the glory, but the bond market can actually tell you things about where this economy is going.
1:02.5	It can tell us what investors think the Federal Reserve is going to do with interest rates,
1:06.1	about which more detail in a minute, by the way. Bonds can also tell you where labor markets
1:10.6	might wind up,
1:11.5	in which direction inflation might trend. So, Marketplace is Justin Ho, starts things off by walking
1:17.6	us through the signals that the bond market has been sending of late. Let's start with yields on short-term
1:23.1	government debt, treasury bills that mature in a year or even less. Really short-term interest rates are really a function of the Federal Reserve.
1:31.4	That's Guy Labar, Chief Fixed Income Strategist at Jenny Montgomery Scott.
1:35.1	He says those yields tend to move in the same direction as the Fed's interest rate decisions.
1:39.6	And lately, short-term yields have been falling.
1:42.1	Short-term interest rates are telling us that while the markets might debate over whether
1:46.2	the Federal Reserve is cutting in December or January, that they're still in cutting mode.
1:51.8	Then there's medium-term government debt, treasuries that mature in three and five years.
	...

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