Markets seem convinced that the US Federal Reserve is going to cut interest rates next month. The only questions investors are now debating is to what extent the central bank will trim rates in July — and how low it will ultimately go.

Jan Hatzius, Goldman Sachs chief economist who long defied consensus by predicting the Fed would keep rates on hold, has now pencilled in two cuts for 2019 on the basis of hints from chairman Jay Powell and his fellow rate-setters.

Meanwhile, the Fed Funds futures market, which allows traders to bet on the direction of US interest rates, is pricing in three quarter-point cuts by the end of the year, beginning in July. Positioning in eurodollar futures, another popular contract for US rate wagers, is now at its highest levels since the peak of the European crisis in 2012, implying a strong conviction that easier monetary policy is just around the corner.