Sport Investors League
  • Politics
  • Stocks
  • Investing
  • Business

Sport Investors League

  • Politics
  • Stocks
  • Investing
  • Business
Business

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

by admin July 18, 2024
July 18, 2024
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

0
FacebookTwitterGoogle +Pinterest
previous post
Dow rises 200 points to close at a record
next post
Top 5 NASDAQ Pharma Stocks of 2024

Related Posts

Microsoft says goodbye to the Windows blue screen...

July 1, 2025

TD Bank pleads guilty in money laundering case,...

October 11, 2024

CFPB sues America’s largest banks for ‘allowing fraud...

December 21, 2024

Boeing to cut 17,000 jobs as losses deepen...

October 15, 2024

‘Wicked’ tallies $19M in previews, as ‘Gladiator II’...

November 25, 2024

Tesla has downsized by at least 14% this...

June 24, 2024

Nvidia CEO Jensen Huang warns China is ‘not...

May 1, 2025

Honda and Nissan officially begin merger talks to...

December 24, 2024

Oil prices rise more than 1% as Israel...

June 21, 2025

Starbucks shakes up its leadership again, adding two...

January 29, 2025

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent

    • House Republicans split with Trump team over ‘very frustrating’ funding fight as shutdown looms

      September 6, 2025
    • DOJ task force finds ‘numerous instances’ of anti-Christian government bias under Biden

      September 6, 2025
    • Trump trashes Nadler on heels of Dem’s House retirement announcement: ‘One of the most disgusting Congressmen’

      September 6, 2025
    • DAVID MARCUS: RFK Jr is right, nobody knows how many Americans died of COVID

      September 6, 2025
    • Justice Barrett opens up about ‘awkward’ start on SCOTUS, shadow docket and more in forthcoming memoir

      September 6, 2025

    Categories

    • Business (1,102)
    • Investing (2,986)
    • Politics (3,639)
    • Stocks (1,155)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: sportinvestorsleague.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 sportinvestorsleague.com | All Rights Reserved