All eyes in global markets are once again on the Fed’s December meeting.
This time around, however, expectations are quite mixed. According to CME Group data, investors now see the probability of a 25 basis point rate cut in December as less than 50%. Investors on the Kalshi platform, however, still give the same scenario a 50% probability.
According to Kalshi’s latest predictions, the probabilities look like this (ignoring the fractions):
- 25 basis point interest rate cut: 50%
- Leaving the interest rate constant: 47%
- Discount over 25 basis points: 4%
This chart shows a significant divide among market participants regarding the Fed’s December meeting. Despite slowing inflation, the weakening labor market and tightening financial conditions make the Fed’s decision even more critical.
Meanwhile, the economic impacts of the ongoing, historically long government shutdown in the US are becoming increasingly apparent. A brief analysis published by Anderson Economic Group LLC on November 14th found that the 2025 shutdown will have even more severe consequences than the previous record-breaking shutdown in 2018-2019.
“The current information we have from the private sector suggests that the economic impact of the 2025 shutdown will be more severe than the 2019 shutdown,” said the company’s CEO, Patrick Anderson, reminding that official data will not be available for at least a month.
*This is not investment advice.