Traders step up hedging, betting the Fed's rate hike cycle may be shallower than the market expects.

Zhito Finance APP has learned that traders are seeking protection against a possibilitythe Federal Reserve may raise interest rates by less than what the market is currently pricing in. Interest rate swaps currently reflect expectations that the Fed will raise rates three times by 25 basis points each before June of next year. This view was further reinforced after Fed policymakers voted last week to raise the target range for the federal funds rate by 25 basis points and signaled that further rate hikes are needed to curb inflation.