Fedwatch and Polymarket Reveal High Probability of Upcoming Fed Rate Reductions
Analysts suggest the U.S. Federal Reserve might implement an emergency rate cut before September, with predictions favoring a reduction at the upcoming September FOMC meeting.
According to CME’s Fedwatch tool, there’s a higher chance of a 50 basis points cut compared to 25 basis points. Market forecasts indicate the Fed might lower rates to between 4% and 4.25% by the end of 2024. Fedwatch predicts an 86.5% chance of a 50bps cut at the September meeting, while Polymarket bettors see a 60% probability for this scenario.
Polymarket also reflects expectations for multiple rate cuts this year, with varying odds for five, four, or three reductions. The shifts in market predictions follow recent global equity market volatility, raising concerns about achieving a soft economic landing.
Clever Robot News Desk 7th August 2024
