The probability of a first 25 basis point cut in June stood at 49%, up from 57% a week ago, CME Group data showed on Monday.
Wall Street futures traders trimmed bets on how much the Federal Reserve will cut rates this year to the lowest level since OctoberLSEG data showed on Monday, amid the evidence of the continued strength of the US economy.
The December federal funds futures contracts on Monday reflected expectations of rate cuts of around 60 basis points this yearcompared to 150 basis points at the beginning of 2024.
The probability of a first cut of 25 basis points in June stood at 49%, compared to 57% a week ago, CME Group data showed on Monday.
Treasury yields, which depend on interest rate expectations, have also risen. The benchmark 10-year yield, which moves inversely to bond prices, hit its highest level since November on Monday.
Data on Friday showed unexpected strength in the labor market, the latest in a series of reports reflecting stronger-than-expected growth.
In January, Those responsible for monetary policy decided to keep the official interest rate between 5.25% and 5.5%, until they have “greater confidence” that inflation is heading towards the 2% objective set by the Federal Reserve .
Investors will closely monitor the March consumer price index, due to be released on Wednesday, to further assess the chances of rate cuts this year.
Source: Ambito
