CME FedWatch Shows 61.4% Probability of a 25-Basis-Point Rate Hike in September

Odaily Planet Daily report: The CME FedWatch tool shows a 61.4% probability of the Federal Reserve raising interest rates by 25 basis points on September 16, raising the target rate range to 3.75%–4.00%, up from 50.6% a month ago. The expectation for a 50-basis-point hike has dropped from 25% a week ago to 0%, with no probability assigned to a rate cut. On July 29, the Federal Open Market Committee voted 9 in favor and 3 against to maintain the target interest rate range at 3.50%–3.75%. Federal Reserve Chair Kevin Warsh stated that the Committee has only one inflation target of 2%, with no soft or implicit inflation target. In the prediction markets, Kalshi traders assign a 53% probability to a 25-basis-point rate hike in September, a 44% probability of no change, with total trading volume exceeding $1.36 million. On Polymarket, trading volume in the relevant market exceeds $8 million, with participants pricing a 52% chance of a rate hike and a 46% chance of no change.