• Fed: 80 bps (99% probability of no change at the upcoming meeting)
  • ECB: 60 bps (95% probability of rate cut at the upcoming meeting)
  • BoE: 90 bps (97% probability of rate cut at the upcoming meeting)
  • BoC: 45 bps (57% probability of rate cut at the upcoming meeting)
  • RBA: 108 bps (98% probability of rate cut at the upcoming meeting)
  • RBNZ: 72 bps (69% probability of rate cut at the upcoming meeting)
  • SNB: 37 bps (96% probability of rate cut at the upcoming meeting)

Rate hikes by year-end

  • BoJ: 8 bps (98% probability of no change at the upcoming meeting)

We can see that compared to last Thursday's update, the market trimmed the easing bets for the Fed as a resilient labour market gives the central bank a reason to keep interest rates steady as they await more developments on the tariff side. A rate cut in June has now less than 50% chances as the market sees a rate cut in July as most likely.

The 80 bps priced in by year-end could see further adjustment as the Fed on Wednesday is likely to reiterate that two rate cuts remain the base case unless the labour market weakens meaningfully.

Source: Forex Live