The CME FedWatch Tool is flashing strong signals, and traders are placing their bets! Hereâs what the market is currently pricing in for the Federal Reserve:
đ For September 2025: â A whopping ~93% probability of the first rate cut. â Target rate expected to fall to 4.00% - 4.25%.
đŻ By December 2025: â A ~92% chance of not one, but TWO total rate cuts. â This would bring the target rate down to 3.50% - 3.75%.
What this means: The market is overwhelmingly confident that the Fed's next major move is a sustained easing cycle, with two cuts solidly on the table for the second half of 2025.