The 3-month treasury just confirmed the cycle has turned: rate cuts coming, peak cash yields behind us, and the Fed preparing to prop up a slowing economy

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Forget the Headlines The 3 Month Treasury Just Told You the Truth.

The 3 month Treasury is basically the market’s closest read on the Fed. It sits right on top of the policy rate, so when it starts drifting meaningfully below that range, it’s the market’s way of saying, “We’re already looking past today’s rate and pricing where the Fed is headed next.”

Historically, it’s also one of the key pieces in recession tracking. When short rates fall while long rates stay sticky, you’re almost always in that late cycle zone where the Fed shifts from tightening to cushioning.

What It’s Telling You Right Now

Given the timing, this move isn’t subtle at all. The Fed has already cut twice this year in September and October and officially ended QT yesterday. They’ve now moved from shrinking the balance sheet to reinvesting everything into T-bills, and the market sees an extremely high likelihood of another cut in a matter of days.

That context is exactly why the 3 month hitting a new 52 week low matters. The front end is basically saying the tightening phase is over. The rate hikes are behind you and traders are now pricing in a real easing cycle, not a one off adjustment.

What jumps out most is how sharply the 3 month has fallen while the 10 year is still sitting around 4%. That’s the classic pattern you get when the Fed begins cutting into a slowing economy, not because things have stabilized, but because the pressure is already showing through the data. Bills trade below fed funds when the market thinks the Fed will have to keep going.

So the way I read it, the 3 month is the cleanest confirmation so far that the cycle has turned. The peak in cash yields is behind us. The Fed is shifting from restraint to support. And the bond market is quietly acknowledging that the economy needs that support sooner rather than later.

It’s late cycle behavior dressed up in a simple number.



Macy’s on Wednesday beat Wall Street’s sales expectations for the third quarter in a row and posted its strongest growth in more than three years as the company’s turnaround strategy showed signs of momentum.

The department store operator raised its full-year sales and earnings outlook after its better-than-expected fiscal third quarter. The retailer now expects adjusted earnings per share of between $2 and $2.20, up from its previous expectation of $1.70 to $2.05, and net sales of $21.48 billion to $21.63 billion, compared with its prior outlook of $21.15 billion and $21.45 billion.

Macy’s said it expects flat to roughly 0.5% comparable sales growth from the previous year. That compares to its previous expectations for a year-over-year decline of between 0.5% and 1.5%. The industry metric takes out one-time dynamics like store openings and closures, and Macy’s includes merchandise that it owns, items for brands that pay for space within its stores and its third-party online marketplace.

It marked the second consecutive quarter Macy’s raised its full-year sales and earnings outlook. The company had cut its full-year earnings outlook in May because of higher tariffs, more promotions and “some moderation” in discretionary spending.

Even so, the projected annual sales would represent a drop from the year-ago net sales of $22.29 billion. Macy’s said about $700 million of that annual net sales decrease is due to the 64 stores it shuttered at the end of the last fiscal year, which ended Feb. 1, and in the early part of this fiscal year.

And Macy’s said in its news release that its outlook anticipates two challenging dynamics – selective spending by consumers and higher tariffs – will persist in the holiday quarter.

Shares dropped about 6% in premarket trading on Wednesday.

https://www.cnbc.com/2025/12/03/macys-m-earnings-q3-2025.html