--- title: "Traders adjust interest rate cut forecasts in response to U.S. inflation data, estimating about a 50% chance of a third rate cut this year" description: "The inflation rate announced by the United States last Friday was 0.2%, lower than expected, leading traders to adjust their expectations for interest rate cuts by the Federal Reserve. A reduction of " type: "news" locale: "en" url: "https://longbridge.com/en/news/276041397.md" published_at: "2026-02-16T07:33:17.000Z" --- # Traders adjust interest rate cut forecasts in response to U.S. inflation data, estimating about a 50% chance of a third rate cut this year > The inflation rate announced by the United States last Friday was 0.2%, lower than expected, leading traders to adjust their expectations for interest rate cuts by the Federal Reserve. A reduction of 63 basis points is anticipated this year, with a roughly 50% chance of a third rate cut before the end of the year. Traders' previous expectations were for a 58 basis point cut. According to data from the Chicago Mercantile Exchange, there is a 48% chance of interest rates being lowered by three-quarters of a percentage point or more before the end of the year. Major Wall Street banks have also pushed back their expectations for rate cuts to the second half of the year The inflation rate in the United States announced last Friday (13th) for last month was 0.2%, lower than expected, marking the smallest increase since July of last year, prompting traders to adjust their expectations for interest rate cuts by the Federal Reserve this year. According to Bloomberg, traders have priced in an interest rate cut by the Federal Reserve this year at about 63 basis points, equivalent to a roughly 50% chance of a third rate cut before the end of the year. Traders had priced in a cut of 58 basis points on Thursday (12th) last week. According to the Chicago Mercantile Exchange's interest rate futures, there is a 48% chance that interest rates will be at least 0.75 percentage points lower than the current level (i.e., three cuts or more) by the end of this year. Earlier, traders had stopped fully expecting a 25 basis point cut in mid-year based on last month's employment data, shifting their expectations to a cut in July. Major Wall Street firms that previously predicted a cut next month have also pushed their expectations to the second half of this year ### Related Stocks - [QQEW.US - First Trust NASDAQ-100 Equal Weighted](https://longbridge.com/en/quote/QQEW.US.md) - [FNCL.US - Fidelity MSCI Financials Index](https://longbridge.com/en/quote/FNCL.US.md) - [ONEQ.US - Fidelity Nasdaq Composite Index ETF](https://longbridge.com/en/quote/ONEQ.US.md) - [IAI.US - ISHRS Us Brokers & Sec Exchg](https://longbridge.com/en/quote/IAI.US.md) - [QCLR.US - Global X NASDAQ 100 Collar 95-110 ETF](https://longbridge.com/en/quote/QCLR.US.md) - [.NDX.US - NASDAQ-100](https://longbridge.com/en/quote/.NDX.US.md) - [.SPX.US - S&P 500](https://longbridge.com/en/quote/.SPX.US.md) - [QQQ.US - Invesco QQQ Trust](https://longbridge.com/en/quote/QQQ.US.md) - [QLD.US - ProShares Ultra QQQ](https://longbridge.com/en/quote/QLD.US.md) - [TQQQ.US - Proshares UltraPro QQQ](https://longbridge.com/en/quote/TQQQ.US.md) ## Related News & Research | Title | Description | URL | |-------|-------------|-----| | Total Nonfarm Payrolls for January 2026 Are Projected to Rise By 75,000 | The median estimate for total nonfarm payroll employment for the month of January 2026 is 75,000. | [Link](https://longbridge.com/en/news/275479380.md) | | U.S. 10-year notes high yield 4.177% | The U.S. Treasury Department reported the results of its Dutch auction for 10-year notes, yielding a high of 4.177%, a m | [Link](https://longbridge.com/en/news/275643060.md) | | Ameritas Advisory Services LLC Has $61.21 Million Stock Holdings in Invesco QQQ $QQQ | Ameritas Advisory Services LLC increased its stake in Invesco QQQ by 42.4% in Q3, owning 101,959 shares valued at $61.21 | [Link](https://longbridge.com/en/news/275868892.md) | | Swedish savers pulled $940 mln from US equity funds in January, data shows | Swedish savers withdrew 8.4 billion crowns ($941 million) from U.S. equity funds in January, following nearly 60 billion | [Link](https://longbridge.com/en/news/275456069.md) | | REG - IVZ Nasdaq-100 Inc $ - Net Asset Value(s) | Invesco Nasdaq-100 Income Advantage UCITS ETF reported a net asset value (NAV) of $6,719,238.02 as of February 12, 2026, | [Link](https://longbridge.com/en/news/275885742.md) | --- > **Disclaimer**: This article is for reference only and does not constitute any investment advice.