Wednesday, August 24, 2005

Fed Fund Futures Probability

As of today, the Fed Fund Futures is pricing that at least 25 basis point hike is pretty much definite. The September price also implies about 50% probabiliy that the Fed will move more aggressively and raise 50 basis points in their upcoming meeting on September 20th.

You can refer to the resources mentioned at the end of my RWW article to see how fed fund futures probability works.

Fed Fund Futures probability simply calculates what these futures prices imply and indicates what market participants expect from the Fed. This is just one of many tools to forecast the Fed's moves.


At 5:59 PM, Anonymous QUALITY STOCKS UNDER 5 DOLLARS said...

Great post


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