Fed Maintains Rates Unchanged in March with 82.3% Probability

Summary

According to CME FedWatch data as of February 10-11, the probability of the Federal Reserve maintaining interest rates at the 3.50%-3.75% range in its March meeting is estimated to be between 78.4% and 82.3%钛媒体快讯+ 2. This follows the Fed’s decision to hold rates steady in January, where the committee noted a ‘solid’ expansion but saw two members dissent in favor of a 25 basis point cutQQ News+ 2. Market expectations have been volatile, with the probability of a March cut rising from 9% on February 4 to over 21% by February 11AnueSec+ 2. The consensus is now pointing towards a potential first cut around the June meeting.

Impact Analysis

So the market is pricing in an ~80% chance the Fed holds in March, but that’s not the real story钛媒体快讯. What’s telling is how the odds for a cut have jumped from 9% to over 20% in about a weekAnueSec+ 2. This signals that conviction in the ‘higher-for-longer’ narrative is starting to fray at the edges.

Remember, the January meeting had two dissenters voting for a cut, even as the official statement turned more hawkish, upgrading growth to ‘solid’QQ News+ 2. That internal split is crucial. The market is betting strong growth gives the Fed a pass to wait, but the dissenters suggest a risk that the Fed is already behind the curve. While consensus now targets a June cut, this setup feels fragile. I’m not calling for a March cut, but I think the market is too complacent. Any weak data could trigger a sharp repricing. This looks like a good spot to own some short-dated volatility.