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CME FedWatch Shows Low Probability of Fed Rate Cut in March

CME FedWatch data reveals a slim 2.7% chance of a rate cut in March, with the Fed expected to hold rates steady through April amid rising inflation risks.

Summary

According to CME FedWatch data, the likelihood of a 25bps rate cut in March is just 2.7%, with 88% probability that the Federal Reserve will maintain current rates. The probability of the Fed keeping rates unchanged through April is 87.3%, driven by inflation concerns exacerbated by Middle East tensions.

Terms & Concepts
  • CME FedWatch: A data tool by the Chicago Mercantile Exchange (CME) that tracks market expectations for U.S. Federal Reserve interest rate changes based on futures pricing.
  • basis point: A unit equal to one hundredth of a percentage point, commonly used to measure changes in interest rates.
  • Federal Reserve: The central bank of the United States responsible for setting benchmark interest rates and conducting monetary policy.