Traders in the futures and options markets are betting that the Federal Reserve will cut interest rates more than expected this year due to the Trump administration's aggressive policy agenda, according to online reports. Washington's tough rhetoric on tariffs has pushed investors into safe-haven assets such as U.S. Treasury bonds, which will become more attractive if signs of recent economic difficulties continue to mount. On Monday, the rising possibility of a recession spurred new demand for short-and long-term U.S. Treasury futures. Options traders expect recession risks to increase pressure on the Fed to cut interest rates in coming months to boost the economy. This has led to growing demand for call options on two-year U.S. debt, which will pay off if the Fed becomes more aggressive on interest rates. The premium on these U.S. debt call options has risen to its highest level since September last year, when slowing job growth in Biden's final months as president raised concerns about a slowing economy. (Jin Shi)