Current:Home > ContactNo Fed rate cut – for now. But see where investors are already placing bets -Ascend Wealth Education
No Fed rate cut – for now. But see where investors are already placing bets
View
Date:2025-04-15 22:27:49
When will the Fed start cutting interest rates?
Investors who bet on the movements of interest rates seem to have a consensus following Wednesday's report on inflation in May and the Fed's latest decision on short-term interest rates.
Almost two thirds of interest-rate investors think the Fed will start easing interest rates following its meeting on Sept. 18, according to the CME FedWatch Tool. The Fed meets in June and July before that meeting.
Only a day before, investors' bets on a September rate cut were nearly divided based on the tool's analysis of the 30-day Fed funds futures pricing. The investors' opinions swung throughout the day on Wednesday, but no more than when the Bureau of Labor Statistics released the May inflation report.
How many cuts interest-rate investors expect by September
Unable to view our graphics? Click here to see them.
How the CME tool swung throughout the day
Inflation report: Minutes after investors learned annual inflation ticked down to 3.3%, the CME tool showed most investors clearly expect a rate cut at the Fed's fall meeting. Inflation on a seasonally adjusted basis was unchanged from April to May.
Fed interest rate announcement: The Fed left its short-term interest rate range between 5.25% and 5.5% following its meeting Wednesday. In addition, the committee scaled back its forecast from three rate cuts to just one this year.
Fed interest rates chart
The Fed policymaking committee started raising interest rates in March 2022 to slow 40-year high inflation. Inflation hit a high of 9.1% in June 2022. After slowing significantly in following months, the annual rate has hovered above 3% throughout 2024
What is inflation expected to be in 2024?
Fed officials estimated on Wednesday that their preferred measure of annual inflation, the personal consumption expenditures (PCE) index, will fall from 2.7% to 2.6% by December, above the 2.4% they predicted in March.
A core PCE inflation reading that the Fed watches more closely is expected to hold steady at 2.8% by the end of the year, above the prior 2.6% estimate. Both overall inflation and the core measure are projected to fall to 2.3% by the end of 2025.
Contributing: Paul Davidson, Daniel de Visé, Medora Lee
veryGood! (1462)
Related
- Sonya Massey's father decries possible release of former deputy charged with her death
- Antoni Porowski and Kevin Harrington Break Up After 4 Years Together
- New Philanthropy Roundtable CEO Christie Herrera ready to fight for donor privacy
- Lana Del Rey talks ex's 'little bubble ego,' Taylor Swift collab, clairvoyant sessions
- 2025 'Doomsday Clock': This is how close we are to self
- As some stores shrink windows for sending back items, these retailers have the best returns policies
- Travis Kelce Thanks Taylor Swift and Her Fans for Helping His and Jason Kelce's Song Reach No. 1
- Travis Kelce Thanks Taylor Swift and Her Fans for Helping His and Jason Kelce's Song Reach No. 1
- Tree trimmer dead after getting caught in wood chipper at Florida town hall
- Missouri driver killed in crash involving car fleeing police
Ranking
- What do we know about the mysterious drones reported flying over New Jersey?
- Britain’s Conservative government set to start cutting taxes ahead of likely election next year
- Cryptocurrency exchange Binance pleads guilty along with CEO to money laundering charges
- 'Please God, let them live': Colts' Ryan Kelly, wife and twin boys who fought to survive
- FACT FOCUS: Inspector general’s Jan. 6 report misrepresented as proof of FBI setup
- Germany and Italy agree on joint ‘action plan’ including energy, technology, climate protection
- Twilight Director Reveals Kristen Stewart Crashed Robert Pattinson’s 37th Birthday Party
- Broadway costuming legend accused of sexual assault in civil suit
Recommendation
South Korea's acting president moves to reassure allies, calm markets after Yoon impeachment
As some stores shrink windows for sending back items, these retailers have the best returns policies
Pope Francis meets with relatives of Israeli hostages and Palestinian prisoners
Another Ozempic side effect? Facing the holidays with no appetite
'Kraven the Hunter' spoilers! Let's dig into that twisty ending, supervillain reveal
Pfizer's stock price is at a three-year low. Is it time to buy?
Kaley Cuoco Reveals Why Her Postpartum Fitness Routine Is Good For My Body and Heart
Patrick Mahomes can't throw the ball and catch the ball. Chiefs QB needs teammates to step up.