Adam Button, an analyst at the financial website Forexlive, said that earlier today, the Reserve Bank of Australia unexpectedly raised interest rates, which has made the market worry whether the same surprise will appear at this week's FOMC meeting. During the U.S. trading session, after the release of two U.S. economic data, U.S. regional bank stocks also sent a strong signal to the Federal Reserve to act cautiously. Some bank stocks fell 30% during the day, and the KRE regional bank index fell 7%, triggering a wider wave of risk aversion.
Fed interest rate swaps show that the probability of the Fed raising interest rates this week has dropped to 82% from nearly 100% yesterday. In addition, the possibility of the Federal Reserve raising interest rates further in June has dropped below zero, and the market currently expects the federal funds rate to fall to 4.39% by the end of the year. (Golden Ten)