Rate cuts by year-end

  • Fed: 105 bps (56% probability of rate cut at the upcoming meeting)
  • ECB: 81 bps (97% probability of rate cut at the upcoming meeting)
  • BoE: 86 bps (85% probability of rate cut at the upcoming meeting)
  • BoC: 76 bps (66% probability of rate cut at the upcoming meeting)
  • RBA: 130 bps (74% probability of rate cut at the upcoming meeting)
  • RBNZ: 88 bps (92% probability of rate cut at the upcoming meeting)
  • SNB: 24 bps (65% probability of rate cut at the upcoming meeting)

Rate hikes by year-end

  • BoJ: 2 bps (99% probability of no change at the upcoming meeting)

As we can see, compared to yesterday's update, traders stepped up again their bets on rate cuts following yesterday's selloff in the stock market. As mentioned yesterday, the rate cuts bets have been a function of the stock market selloff as that impacts negatively the wealth effect and depresses the consumer and business sentiment.

Source: Forex Live