Financial market returns to pricing in interest rate hikes by the Fed until December

The financial market once again saw the majority chance of the Fed (Federal Reserve, the North American central bank) raising interest rates in December this year, according to the CME Group monitoring tool.

Issue in negotiations for an agreement between the United States and Iran to end the war, high oil prices in the session and data showing resilience of the American economy support expectations of monetary tightening.

The probability of an accumulated increase of 25 basis points (bps) in interest rates by the end of the year was 42%, while the probability of an accumulated increase of 50 basis points was 16.3%, compared to levels of 37% and 9.5% the day before.

The market attributed a 38.8% chance of the rate being maintained in December.

The market still sees interest rates remaining at the next Fomc (Federal Open Market Committee) meeting in June.

According to the CME, the probability of rate stability remains largely in the majority (99.3%).

Treasury scenario in the US reduces the chance of interest rate cuts, says expert | MARKET OPENING

Source: CNN