Fed Funds Rate – Target Probabilities at the Fed’s FOMC Meeting In light of Fed chair recent comments, market expectations for a rate cut at the upcoming FOMC meeting on December 18, 2024, have shifted. Traders now estimate a 61.9% probability of a 25 basis point rate cut at this meeting. Image: CME Group
Fed – The Distribution of FOMC Voters Should investors bet for a hawkish Fed policy tone in 2025, as the central bank remains focused on its fight against persistent inflation, even if it means risking some economic pain? Image: BofA Global Research
Fed – Rate Hikes at FOMC Meetings When will the Fed stop hiking interest rates? Goldman Sachs expects 75bp additional rate hikes in 2023. Image: Goldman Sachs Global Investment Research
U.S. GDP, Inflation and Unemployment – FOMC Economic Projections The Fed is forecasting an unemployment rate of 4.6% in 2023. Image: The Daily Shot
U.S. Federal Funds Target Rate: FOMC Projection Stocks tend to underperform in times of tight monetary policy. Image: Alpine Macro
Fed Funds Pricing by FOMC Meeting Markets expect a Fed funds terminal rate at 3.25% and the Fed to cut rates in 2023. Image: BofA Global Research
Fed Rate Cut – Overnight Indexed Swaps (OIS) Strip for FOMC Meetings over the Next 12 Months Traders see one more Fed interest rate cut this year. Image: Morgan Stanley Research
Before the Next FOMC Meeting, the Fed Funds Market Is Pretty Accurate Probability of a Fed rate cut on July 31, 2019: 100% (Fed funds market expectation). Image: Bianco Research
The Fed Funds Market Is Rarely Wrong About the Next FOMC Meeting Seven days before a FOMC meeting, the market has been accurate 95% of the time since 1994. Image: Bianco Research
Probability of Fed Rate Cut After the CPI data release, traders now estimate an 82.5% chance of a 25 basis point rate cut at the FOMC meeting on December 18, 2024. Image: CME GRoup
U.S. GDP Growth Forecasts Goldman Sachs is more bullish on U.S. GDP growth than the consensus and the FOMC’s forecast, reflecting their confidence in a stronger performance for the U.S. economy. Image: Goldman Sachs Global Investment Research