Will a Quarter-Point Cut Make the Markets Blue?

The article reports on the prospect of an interest-rate reduction in the U.S. Federal funds market. The Federal Reserve is anticipated to lower its federal-funds rate target amid signs of an economic slowdown. Lehman Brothers Treasury trading head Scott Gewirtz stated that investors are becoming more comfortable with the idea of a 0.25 point reduction. Gewirtz noted that a larger cut could widen the gap between the two-year and the 30-year yield by nearly 0.1 percentage point.