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Fed's October rate hike probability falls to around 50%, market expectations split
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According to CME Group's FedWatch Tool, as of September 30, the probability of the Federal Reserve maintaining its benchmark interest rate at 3.75%-4.00% at its October meeting is 49.6%, while the probability of a 25-basis-point hike to 4.00%-4.25% stands at 50.4%. Looking further ahead to the December meeting, the probability of rates remaining unchanged at 3.75%-4.00% is only 8.5%. The most likely scenario is a cumulative 25-basis-point hike by December, with a 49.8% probability, while a cumulative 50-basis-point hike has a 41.8% probability. These probabilities reflect market expectations based on fed funds futures pricing data.
Source report
September 30 — According to the CME "FedWatch" tool:
- The probability of the Federal Reserve holding interest rates steady at 3.75%–4.00% during its October meeting stands at 49.6%.
- The probability of a 25-basis-point rate hike in October is 50.4%.
Looking ahead to the December meeting:
- Probability of rates remaining unchanged at 3.75%–4.00%: 8.5%
- Probability of a cumulative 25-basis-point hike: 49.8%
- Probability of a cumulative 50-basis-point hike: 41.8%
Source
domesticNeutral / independent
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CME FedWatch shows shifting odds for Fed rate hike in October meeting