Deciphering FOMC: Navigating Market Volatility
Posted By:- Ilan Levy-Mayer Vice President, Cannon Trading Futures Blog
FOMC Week
By John Thorpe, Senior Broker
This week’s market moving features will be the closely watched with CPI pre market Wednesday and The FOMC meets Tomorrow and Wednesday.
The FOMC statement released at 1:00 CT on Wednesday will give a close read for any guidance in regard to the interest rate outlook.
This meeting will also be the release of the “Summary of Economic Projections” or SEP
The prior SEP was issued on March 20 and implied three rate cuts of 25 basis points later in 2024. Shortly after that, the data on inflation, the labor market, and economic growth made that projection out-of-date.
It is widely anticipated that the SEP will reduce the forecast for rate cuts to only one or two this year.
Powell’s prepared remarks regarding this rate decision will occur @1:30 CT.
Traders who are well informed know of the Interest Rate decision probabilities “Baked” into the market. They use the CME’s FedWatch tool.. as we do.
If you would like a personal tutorial, please call 800 454 9572 and simply ask for a fed watch tutorial! The current probability of no rate movement up or down this week is 99.1 %.
If you are curious about the Next fed meeting in July? It’s currently @ 91.1 % probability of stay the same with an 8.9% chance of a .25 reduction.
From a trader’s standpoint, it’s fascinating to watch these percentages change intraday as new data, like the Wednesday CPI release, will undoubtedly change the percentage probabilities for all future FOMC rate decision meetings on the calendar.
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* This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.
