📉📈Wednesday FOMC meeting preview: Is the interest rate cut drama about to take place? 🏦💸
😐On the upcoming Wednesday, the focus of the market is on the meeting of the Federal Open Market Committee (FOMC). At present, the market generally expects that the meeting will keep the interest rate unchanged (the current interest rate is 525 to 550), and the probability of a rate cut is only 4.1%, while the probability of maintaining the current interest rate level is as high as 95.9%.
🤑However, for the FOMC meeting on September 18, the market expectations are completely different. It is predicted that the probability of a rate cut at that time is 100%, and the probability of maintaining the current interest rate level has dropped to 0. Specifically, the probability of a 25 basis point rate cut is 89.6%, while the probability of a 50 basis point rate cut is 10.1%.
🔍Looking at the November FOMC meeting, the market expects a 25 basis point rate cut probability of 35.2%, while the probability of a 50 basis point rate cut is as high as 58.4%.
This shows that the market generally expects a 25 basis point rate cut at the September and November meetings with a probability of 89.6% and 35.2% respectively, while the probability of a 50 basis point rate cut at the November meeting is also quite high. 😲
💰 As for the last FOMC meeting at the end of the year, on December 18, the market expects a 75 basis point rate cut with a probability of 53.5% and a 50 basis point rate cut with a probability of 37.0%. This shows that the market generally believes that there will be at least three rate cuts by the end of this year, and the total rate cut may reach 75 basis points.
However, I have to remind everyone that although market expectations are hot, we cannot be too optimistic. 🔎If Fed Chairman Powell pours cold water on the expectation of three rate cuts at the end of the year at the meeting on Wednesday, the market may usher in another wave of corrections. As for the extent of the correction, whether it will fall below 60,000 points or even approach 50,000 points, this is definitely a major event that we must pay close attention to. 😟
😲What do you think? How many times do you think the interest rate will be cut by the end of the year, and what will be the maximum rate cut? Feel free to comment!
