The Future of the Federal Funds Rate & Mortgage Rates Insights
As we pore over the color-coded probabilities from the latest CME FedWatch Tool, a pattern emerges that hints at the anticipated trajectory of the Federal Reserve's interest rate decisions. The blue highlighted boxes serve as a beacon, illuminating where a consensus of experts predicts the fed funds rate will land at upcoming Federal Open Market Committee (FOMC) meetings. The CME FedWatch Tool is a visual representation of market sentiment and expectations regarding FOMC decisions. The blue highlights draw our attention to the ranges with the highest probabilities, effectively a collective bet by market participants on where the fed funds rate is most likely to settle. March 2024: A Turning Point A significant takeaway from the tool is the strong belief among experts that starting in March 2024, we will witness a pivotal shift. The probabilities lean toward a decrease in the fed funds rate, as indicated by the blue hues shading lower rate intervals for that meeting and subsequent o...