Fed rate cut next month? Traders are betting on it
The U.S. central bank will move to reduce borrowing costs as soon as next month to cushion the world's biggest economy from the impact of the coronavirus, traders of futures contracts tied to the Federal Reserve's policy rate are now betting.
Traders now see a nearly 60% chance of a rate cut at the Fed's March meeting, according to CME Group's FedWatch, which translates fed funds futures pricing into traders' monetary policy expectations.
That's up from 33% on Wednesday, before U.S. President Donald Trump appointed Vice President Mike Pence to head public health efforts to contain the virus' spread and leaders around the world rallied their nations to prepare for an epidemic of the flu-like illness that originated in China.
A second Fed rate cut is now priced in for June, and a third one in September.
https://www.msn.com/en-us/money/markets/fed-rate-cut-next-month-traders-are-betting-on-it/ar-BB10txvc?li=BBnbfcN&ocid=hplocalnews
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