Your Own Liberty - Investing and Stock News
  • Investing
  • Stock
  • Latest News
  • Editor’s Pick
  • Economy
  • Investing
  • Stock
  • Latest News
  • Editor’s Pick
  • Economy
No Result
View All Result
Your Own Liberty - Investing and Stock News
No Result
View All Result
Home Stock

Traders see the odds of a Fed rate cut by September at 100%

by
July 17, 2024
in Stock
0
Traders see the odds of a Fed rate cut by September at 100%

Traders are now 100% certain the Federal Reserve will cut interest rates by September.

There are now 93.3% odds that the Fed’s target range for the federal funds rate, its key rate, will be lowered by a quarter percentage point to 5% to 5.25% in September from the current 5.25% to 5.50%, according to the CME FedWatch tool. And there are 6.7% odds that the rate will be a half percentage point lower in September, accounting for some traders believing the central bank will cut at its meeting at the end of July and again in September, says the tool. Taken together, you get the 100% odds.

The catalyst for the change in odds was the consumer price index update for June announced last week, which showed a 0.1% decrease from the prior month. That put the annual inflation rate at 3%, the lowest in three years. Odds that rates would be cut in September were about 70% a month ago.

The CME FedWatch Tool computes the probabilities based on trading in fed funds futures contracts at the exchange, where traders are placing their bets on the level of the effective fed funds rate in 30-day increments. Simply put, this is a reflection of where traders are putting their money. Actual real-life probability of rates remaining where they are today in September are not zero percent, but what this means is that no traders out there are willing to put actual money on the line to bet on that.

Fed Chairman Jerome Powell’s recent hints have also cemented traders’ belief that the central bank will act by September. On Monday, Powell said the Fed wouldn’t wait for inflation to get all the way to its 2% target rate before it began cutting, because of the lag effects of tightening.

The Fed is looking for “greater confidence” that inflation will return to the 2% level, he said.

“What increases that confidence in that is more good inflation data, and lately here we have been getting some of that,” added Powell.

The Fed next decides on interest rates on July 31 and again on Sept 18. It doesn’t meet on rates in August.

This post appeared first on NBC NEWS
Previous Post

Dow rises 200 points to close at a record

Next Post

Jerome Powell indicates Fed won’t wait until inflation is down to 2% before cutting rates

Next Post
Jerome Powell indicates Fed won’t wait until inflation is down to 2% before cutting rates

Jerome Powell indicates Fed won’t wait until inflation is down to 2% before cutting rates

Enter Your Information Below To Receive Trading Ideas and Latest News

    Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

    Popular News

    Tariffs and weaker beer demand are weighing on Modelo owner Constellation Brands

    Tariffs and weaker beer demand are weighing on Modelo owner Constellation Brands

    July 11, 2025
    State Department to begin mass layoffs of about 1,800 employees in coming days

    State Department to begin mass layoffs of about 1,800 employees in coming days

    July 11, 2025
    EU’s von der Leyen survives parliament confidence vote brought by far-right

    EU’s von der Leyen survives parliament confidence vote brought by far-right

    July 11, 2025

    About Proud For Profits

    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Main Categories

    • Investing
    • Stock
    • Latest News
    • Editor’s Pick
    • Economy

    Latest News

    • Tariffs and weaker beer demand are weighing on Modelo owner Constellation Brands
    • State Department to begin mass layoffs of about 1,800 employees in coming days
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Copyright © 2025 yourownliberty.com | All Rights Reserved

    No Result
    View All Result
    • Investing
    • Stock
    • Latest News
    • Editor’s Pick
    • Economy

    Copyright © 2025 yourownliberty.com | All Rights Reserved