(Bloomberg) -- In just two days, the bond market has gone from doubting the Federal Reserve to falling perfectly in line with the US central bank’s projection for a peak in interest rates north of 5% later this year.

The peak level priced into the US swaps curve for the Fed’s benchmark rate around midyear is now 5.12%, up from 4.91% as of Thursday’s close. That matches the median view of Fed officials from December, when they last published projections.

Friday’s stronger-than-expected jobs numbers ignited the jump in front-end yields, while a slide in European bonds further fueled the rise on Monday.

Before the release of the jobs report, traders already were looking at a quarter-point rate hike at the central bank’s next policy meeting in March as a done deal. Now, an increase at the next meeting in May is also looking highly likely, and another in June is being viewed as a possibility too, according to pricing in overnight index swaps.

Where there’s still disagreement between markets and the Fed is over the outlook for the second half of the year. While central bank policymakers have said they expect to raise their benchmark rate above 5% and then hold it at that level at least through 2023, traders have long been pricing in a series of rate cuts beginning shortly after the benchmark reaches its peak in June and July.

But that view may be starting to change, too. Monday’s session saw a flurry of activity in options tied to the Secured Overnight Financing Rate — which is closely linked to the Fed’s benchmark — as traders scaled back bets on rate cuts in the second half of the year.

Current swap rates aren’t the highest ones observed so far during the current tightening cycle. In early November, the market priced in peak rates of about 5.25%. At the time, however, the Fed’s own projections were lower.

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