Why the Fed Funds Rate Floor Matters More Than the Ceiling

Lucas and Luna dive into a surprising shift in the bond market: the 3-month Treasury yield has climbed above the Fed funds rate, effectively making the 'floor' of the yield curve higher than the policy rate. They explain why this inversion matters for money market funds, bank lending, and the curve normalization trade. Using current data—the 3-month yield at 3.78% vs. the Fed funds rate at 3.62%—they explore how this 'floor inversion' signals tight liquidity and could reshape fixed income allocation. A must-listen for bond investors wondering why short-term yields aren't falling with the Fed on hold. #TreasuryYields #FedFundsRate #YieldCurve #MoneyMarketFunds #Liquidity #BondInvesting #FexingoBusiness #BusinessPodcast #Finance #FixedIncome #ThreeMonthYield #ShortTermBonds #CurveInversion #MonetaryPolicy #CashManagement #RiskManagement #MacroEconomics #InvestmentStrategy Keep every episode free: buymeacoffee.com/fexingo