CME Data Shows 95% Probability of Fed Rate Cut in October
CME FedWatch data now points to a 99% chance of a 25 basis point Federal Reserve rate cut in October, with expectations of further reductions by December.
Summary
CME’s FedWatch Tool on October 18 reported a 99% likelihood that the Federal Reserve will cut interest rates by 25 basis points in October, with a 1% chance of a 50 basis point reduction. By December, there is a 94% chance of a cumulative 50 basis point cut, and a 6% chance of a 75 basis point reduction, signaling growing market confidence in continued policy easing.
Terms & Concepts
- Basis Point: A unit equal to one hundredth of a percentage point, commonly used to describe changes in interest rates.
- CME FedWatch Tool: A market-based indicator that uses CME futures data to estimate the probability of changes in the U.S. Federal Reserve’s monetary policy.