February 21, 2025 21:14 GMT
STIR: July Fed Cut Priced Back In
STIR
The next Fed rate cut is again fully priced for the July meeting, following a 6bp futures-implied move today on the back of soft Services PMI data exacerbated in the afternoon by a risk-off move in equities.
- This comes following a run of mixed-at-best data (retail sales, housing starts, various consumer and business surveys) in the last week and is the first time a July cut has been priced since Feb 7 (just prior to January payrolls data) - previously it was priced for September.
- There's now almost two rate cuts priced through the end of the year (47bp through the December FOMC, an increase of 9bp on the day), the most seen since Feb 5.
- For the week, implied 2025 rate cuts have ranged between 35 and 48bp (the latter seen in the last hour of trade)
- See our US Macro Weekly for more on what to watch next week, with PCE and GDP the data highlights.
| Meeting | Current FF Implieds (%), LH | Cumulative Change From Current Rate (bp) | Incremental Chg (bp) | Prior Session (Feb 20) | Chg Since Then (bp) | End of Last Week (Feb 14) |
| Mar 19 2025 | 4.32 | -1.5 | -1.5 | 4.32 | -0.9 | 4.32 |
| May 07 2025 | 4.25 | -8.4 | -6.9 | 4.28 | -3.1 | 4.28 |
| Jun 18 2025 | 4.14 | -19.4 | -11.0 | 4.18 | -4.2 | 4.18 |
| Jul 30 2025 | 4.07 | -26.2 | -6.8 | 4.13 | -6.0 | 4.13 |
| Sep 17 2025 | 3.97 | -35.7 | -9.5 | 4.04 | -6.5 | 4.04 |
| Oct 29 2025 | 3.92 | -41.2 | -5.5 | 4.00 | -8.0 | 3.99 |
| Dec 10 2025 | 3.86 | -47.3 | -6.1 | 3.95 | -8.8 | 3.93 |
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