The FedWatch Tool depicted in the image illustrates market expectations for the Federal Reserve’s upcoming decision on interest rates for the September 18, 2024, meeting. Currently, the target rate is set between 525-550 basis points (bps). The chart shows a 57% probability of a rate cut to 500-525 bps and a 43% chance of a more aggressive cut to 475-500 bps. Last week probabilities for a 50bps cut were at 30%.
The CME FedWatch Tool is designed to track the probability of Federal Reserve interest rate changes based on fed funds futures prices. It provides real-time data on the likelihood of rate adjustments at upcoming FOMC meetings.
This tool provides real-time probabilities based on fed funds futures, guiding market participants on the potential direction of Federal Reserve policy.
You can explore more details here.
