Rate hike in October is up in the air! Will the expected one-night “dip” turn green and rise?
Latest CME data: The probability of the Federal Reserve raising rates by 25 basis points in October has plunged from 70% the previous day to 50.4%, almost a fifty-fifty split.
Why the sudden cooldown? Three reasons:
1. International oil prices took a sharp dive on Tuesday, and inflation expectations followed down;
2. Fed official Williams said: “There’s no need to rush into a rate hike—let’s look at the data first”;
3. U.S. September consumer confidence fell to the lowest level since 2014, at 81.9—leaving the Fed in a dilemma.
After Williams’ remarks, traders immediately cut their bets. The odds of holding steady in October are now 49.6%, versus a 50.4% chance of a rate hike. By December, the probabilities of a cumulative hike of 25 or 50 basis points are about 50% and 42%, respectively.
With the uncertainty about a rate hike returning, the market holds its breath and waits for the data! #股票财报季
Latest CME data: The probability of the Federal Reserve raising rates by 25 basis points in October has plunged from 70% the previous day to 50.4%, almost a fifty-fifty split.
Why the sudden cooldown? Three reasons:
1. International oil prices took a sharp dive on Tuesday, and inflation expectations followed down;
2. Fed official Williams said: “There’s no need to rush into a rate hike—let’s look at the data first”;
3. U.S. September consumer confidence fell to the lowest level since 2014, at 81.9—leaving the Fed in a dilemma.
After Williams’ remarks, traders immediately cut their bets. The odds of holding steady in October are now 49.6%, versus a 50.4% chance of a rate hike. By December, the probabilities of a cumulative hike of 25 or 50 basis points are about 50% and 42%, respectively.
With the uncertainty about a rate hike returning, the market holds its breath and waits for the data! #股票财报季
