The CME Group FedWatch tool lets you quickly gauge the market’s expectations of potential changes to the Fed Funds target rate. The CME Group FedWatch is based on 30-Day Fed Funds futures prices, which have long been used to express the market’s views on the likelihood of changes in U.S. monetary policy.
- FOMC meetings are matched with the corresponding 30-Day Fed Funds Futures contract.
- Probabilities of possible Fed Funds Target Rates are calculated based on the post-meeting Fed Fund Futures contract price.
- Probability of Rate Hike is calculated by adding the probabilities of all target rate levels of 0.50 or higher.