CME Releases Fed Rate Cut Probability Forecasts for March and Beyond

Summary

According to the CME “FedWatch” tool on March 2, the probability of the Fed cutting rates by 25 basis points in March is 6.4%, with a 93.6% chance of holding steady. This represents a significant decrease from early February when the probability of a March cut was 21.6% AnueSec. The likelihood of a cut has steadily declined, hitting 7.8% on Feb 23 and 4.0% on Feb 24 . Looking ahead, the probability of a cumulative 25 bps cut by April is 22.6%, and it rises to 43.9% for the June meeting, making it the first meeting where a cut is seen as a significant possibility Zhitong. This uncertainty has driven record open interest in U.S. Treasury futures at CME StockTitan.

Impact Analysis

So the market has officially given up the ghost on a March cut. The probability has collapsed from over 20% in early February to just 6.4% now AnueSec+ 2. This isn’t a surprise; it’s the final confirmation of a month-long trend of the market repricing to the Fed’s hawkish reality. They’re basically admitting the ‘pivot’ isn’t coming as soon as they’d hoped.

The real story is the focus shifting to June, and even that’s just a 44% probability—basically a coin flip Zhitong. This prolonged uncertainty is exactly why we’re seeing record hedging activity, with open interest in Treasury futures at CME hitting all-time highs StockTitan. The game here is that consensus is still catching up. The path of least resistance is for these odds to get pushed out even further. This environment continues to favor a strong dollar and pressures long-duration growth assets. The trade remains to be cautious on rate-sensitive sectors until the market fully prices in a post-June liftoff.