Traders have shifted their expectations for the next Federal Reserve interest-rate cut, with momentum building for a move in June rather than July.
The odds of a quarter-point reduction at the June meeting stand at 45.2%, up from 43% a week ago and virtually even with the chances of no change that month, which are now at 45.6%. A week ago, the odds of rates remaining where they are now in June was at 50%, according to the CME FedWatch tool.
It’s a subtle move but still interesting for what it says about how investors see the outlook. Traders still project a quarter-point cut by July, and the greatest odds are still on rates staying at that level through the end of the year.