CME FedWatch Signals 85.8% Chance of Fed Rate Cut in September

IconCryptoNewsTerminal Staff25 Jul, 2024

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CME FedWatch Signals 85.8% Chance of Fed Rate Cut in September

The Federal Reserve is poised to cut interest rates again in September, according to CME Group's FedWatch tool. Traders are currently pricing in an 85.8% probability of a rate cut at the Fed's next meeting. This increased likelihood of a rate cut comes after the Commerce Department reported that second-quarter GDP grew at a 2.8% annualized rate, which was above the market estimate of a 2.0% increase. The stronger-than-expected GDP growth suggests that the economy is still expanding, but at a slower pace than earlier in the year. The Fed has already cut interest rates once this year, in July, and has signaled that it is willing to cut rates further if necessary to support the economy. The Fed is particularly concerned about the impact of the trade war with China on the U.S. economy. Traders are now betting that the Fed will cut rates by a quarter-point at its September meeting. This would bring the target range for the federal funds rate to 1.75% to 2.00%. ```

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