Federal Reserve Rate Cut Projections: Probability Analysis

New data from CME’s ‘FedWatch’ tool suggests a significant likelihood of the Federal Reserve implementing a 25-basis-point interest rate decrease in December. According to the tool, this move is predicted to occur with a 67.8% probability. Conversely, the possibility of maintaining the current interest rates stands at 32.2%. Looking ahead to January, the chances of a cumulative 25 basis point rate cut are 56%, while the likelihood of keeping rates unchanged remains at 21.5%. Furthermore, there’s also a 22.5% chance of a 50 basis-point rate cut by January.