Traders give a 91.8% chance of a quarter-point cut and an 8.2% chance of a half-point cut when the Federal Open Market Committee meets next week, according to the CME FedWatch Tool. That’s up from 88.9% for just a quarter-point cut last month.
“While this week’s Producer Price Index (PPI) and Consumer Price Index (CPI) reports could surprise the market, it’s highly unlikely they’ll alter the Powell Fed’s decision at this point,” writes Bespoke Investment Group co-founder Paul Hickey. “The Powell Fed has thus far avoided surprising the market, and with a rate cut currently priced in with 100% certainty, a change of course would be very unusual.”
