ChainCatcher, citing Jinshi, reported that CME FedWatch data shows a notable shift in the probability distribution for the Federal Reserve’s rate path through July. The probability that the Fed keeps interest rates unchanged by July is now 64%, compared with 91% before the decision. The probability of a cumulative 25-basis-point rate hike by July is 35.1%, up from 8.9% before the decision, while the probability of a cumulative 50-basis-point hike is 1%, compared with 0% previously.
For the December horizon, CME FedWatch shows the probability of rates remaining unchanged at 14.2%, down from 38.2% before the decision. The probability of a cumulative 25-basis-point increase by December is 36.4%, compared with 43% before the decision. The probability of a cumulative 50-basis-point increase is 33.8%, up from 16.2% before the decision.
The data also includes higher cumulative rate-increase ranges for December. The probability of a cumulative 75-basis-point hike is 13.5%, compared with 2.4% before the decision. The probability of a cumulative 100-basis-point hike is 2.1%, compared with 0.1% before the decision. These figures come from CME FedWatch and describe changes in the probability distribution across different interest-rate scenarios and timeframes.