Insights August 6, 2025 Swap Rates Rundown Sahil Pankhaniya Associate July and Early August 2025 Highlights 3 Things to Know: Rates march higher, then plummet. Rates rose ~15bps throughout July, only to fall ~20bps to start August after weak payrolls data. Rates are now just ~5bps above April’s YTD lows. Labor market cracks. Payrolls growth was weaker than expected in July, while May and June figures were revised lower by 125,000 and 133,000 to 19,000 and 14,000, respectively. Excluding COVID-era adjustments, the June and May combined revisions were the largest on record, and indicated that labor conditions may not have been as strong as previously thought. Powell calls current Fed stance appropriate. As expected, the Fed held rates steady for a fifth consecutive meeting, but two FOMC voters dissented in support of rate cuts. Still, Chair Powell said he views the Fed’s “moderately restrictive” approach as “appropriate” given uncertain tariff-related inflation risks. Following the latest labor data, futures markets now see a ~90% chance of a 25bp cut in September, vs. ~47% on the day of the FOMC meeting. Explore More: June Labor Data (+6 bps) 10-year UST Auction Results (-6 bps) Canada Tariff Threats (+8 bps) June CPI Data (+5 bps) Bessent Calls for Review of Fed (-9 bps) Japan, EU Trade Deal Progress (+8 bps) June JOLTS Data (-7 bps) July FOMC Meeting Transcript (+6 bps) July Labor Data (-20 bps) Contact us:415-992-8200[email protected]
