To monitor the FED rate, you can check their forecasts on the FEDWATCH site.
You can see when the FED is scheduled to meet next and the rate hike forecasts that change weekly, which I find very helpful for investing.
Investing.com
https://kr.investing.com/central-banks/fed-rate-monitor
CME
https://www.cmegroup.com/ko/markets/interest-rates/cme-fedwatch-tool.html
According to Investing.com, the next FED rate decision will be on June 15th.
With the current rate between 5.00 and 5.25, there is an 84.5% chance that the Fed will decide to stop raising rates on June 15.
What's impressive is that the probability of a rate hike from the previous week -> the day before -> the day after -> the current rate hike is getting weaker: 91.5% -> 88.2% -> 84.5%.
I guess it's true that it's still quite high.
Looking at the schedule and probabilities for the July 27 meeting, the probability of a 25bp cut to 4.75-5.0% is about 29.3%, which is also decreasing from the previous week->the day before->now.
If you look at it backwards, the probability of a rate hike is relatively low at 10.1%, so I think it's safe to say that a rate hike is certain, but the probability of a rate cut is also significant.
Let's look at the far future (?).
If you look at the November '24 forecast, you can see that there is a 54% probability of 2.75 to 3.25%. Roughly speaking, I'm expecting rates to move back down to the low 2% to low 3% range in the next year or so. (This should be a meaningful indicator for intermediate to long term bond investors).
The FED's historical rate history also seems to confirm this.
It's clear that this rate hike is well above the downward trend line that has been in place since 1984.
It looks like CME Group is using futures prices to generate the rate forecasts above.
Assumptions and interpretation of the FedWatch tool :
The probability of a rate hike is calculated by summing the probabilities of all target rate levels above the current target rate.
The probability for each fed funds target rate is based on the price of the fed funds futures contract, which assumes a rate hike of 0.25% (25 basis points) and that the federal funds effective rate (FFER) will respond by the same amount.
The probability of an FOMC meeting is derived from the corresponding CME Group federal funds futures contract.
This week, the 10-year US Treasury rate has been stabilizing to the downside, with a triangle convergence-like shape that looks like it's poised to go one way or the other.
Last week, the price of oil fell hard.
We'll have to wait and see if it makes a double bottom and bounces back, or if it continues to trend lower.
