Menu

Search

  |   Commentary

Menu

  |   Commentary

Search

Fed Hike aftermath Series: Hike probabilities over coming meetings

FOMC followed through its promise and hiked rates four times in 2018 and forecasted two more rate hikes for 2019. Current Federal funds rate - 225-250 bps (Note, all calculations are based on data as of 22nd July)

  • July 2019 meeting: Market is attaching 22.5 percent probability that rates will be at 1.75-2.00 percent, and 77.5 percent probability that rates will be at 2.00-2.25 percent.
     
  • September 2019 meeting: Market is attaching 15 percent probability that rates will be at 1.50-1.75 percent, 59.3 percent probability that rates will be at 1.75-2.00 percent, and 25.7 percent probability that rates will be at 2.25-2.50 percent.
     
  • October 2019 meeting: Market is attaching 7.5 percent probability that rates will be at 1.25-1.50 percent, 37.3 percent probability that rates will be at 1.50-1.75 percent, 42.4 percent probability that rates will be at 1.75-2.00 percent, and 12.8 percent probability that rates will be at 2.00-2.25 percent.
     
  • December 2019 meeting: Market is attaching 21.9 percent probability that rates will be at 1.25-1.50 percent, 39.2 percent probability that rates will be at 1.50-1.75 percent, 31 percent probability that rates will be at 1.75-2.00 percent, and 7.9 percent probability that rates will be at 2.00-2.25 percent.
     

The probability is suggesting,

  • Since our last review a week ago, the probabilities have eased on the back of Fed speakers signaling rate cuts.
  • The market is pricing the possibility of a rate cut with 100 percent probability, compared to 100 percent last week.  
  • The market is pricing a second rate cut with 92.1 percent probability, compared to 89.6 percent a week ago, and 88.8 percent in the week before that.
  • The market is also pricing a third rate cut in 2019 with 53.5 percent probability, compared to 49.4 percent a week ago, and 61.1 percent in the week before that.
  • The first-rate cut is priced in July 2019 with 100 percent probability. The second rate cut is priced in October with 87.2 percent probability. 
  • ET PRO
  • Market Data

Market-moving news and views, 24 hours a day >

July 2 15:00 UTC Released

DKCurrency Reserves

Actual

449.6 Stale

Forecast

Previous

451.7 Stale

July 2 13:45 UTC Released

USISM NY Biz Conditions

Actual

50 %

Forecast

Previous

48.6 %

January 31 00:00 UTC 822687822687m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

January 31 00:00 UTC 822687822687m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

January 22 19:00 UTC 834507834507m

ARTrade Balance

Actual

Forecast

Previous

-1541 %

January 31 00:00 UTC 822687822687m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

January 22 19:00 UTC 834507834507m

ARTrade Balance

Actual

Forecast

Previous

-1541 %

January 31 00:00 UTC 822687822687m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

January 31 00:00 UTC 822687822687m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

January 31 00:00 UTC 822687822687m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

Close

Welcome to EconoTimes

Sign up for daily updates for the most important
stories unfolding in the global economy.