CME FedWatch: Market Now Sees 22% Chance of a 50bp Rate Cut in September
CryptoNewsTerminal Staff03 Aug, 2024
CME FedWatch: Market Now Sees 22% Chance of a 50bp Rate Cut in September
The CME FedWatch tool is pricing in a 22% chance that the Federal Reserve will cut interest rates by 50 basis points at its September FOMC meeting. This is a significant increase from the 12% probability that was priced in before the release of the Fed's latest economic projections. The CME FedWatch tool is a widely followed measure of market expectations for future interest rate movements, and it is based on the prices of futures contracts that are traded on the Chicago Mercantile Exchange (CME). The increase in the market's expectations for a 50bp rate cut comes as the Fed continues to battle high inflation. The Fed has already raised interest rates by 75 basis points this year, and it is widely expected to raise rates by another 50 basis points at its July meeting. However, the market is now pricing in a higher probability of a 50bp rate cut in September, as investors become increasingly concerned about the impact of the Fed's rate hikes on the economy. If the Fed does cut rates by 50 basis points in September, it would be the first time that the central bank has cut rates by that much since the global financial crisis in 2008.
