Fed Fund Futures Have Odds At 7% (Not Likely) The U.S. Prime Rate Will Rise Again At The January 27, 2016 FOMC Monetary Policy Meeting

Prime Rate Forecast - Predictions

Latest Prime Rate Forecast

As of right now, the investors who trade in fed fund futures via the CME Group have odds at 7% (as implied by current pricing on contracts) that the Federal Open Market Committee (FOMC) will vote to raise the target range for the benchmark fed funds rate by at least 25 basis points (0.25 percentage point) at the January 27^TH, 2016 monetary policy meeting (not likely.)

The current United States Prime Rate, which went into effect on December 17, 2015, is 3.5%.

NB: US Prime Rate = (The Fed Funds Target Rate + 3)

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The Fed has plenty of economic cud to chew between now and the end of January: cheap crude oil, waning manufacturing and the potential for disinflation.  Stay tuned!

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Current Odds

• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the January 27^TH, 2016 FOMC monetary policy meeting: 7% (not likely.)
  
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• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the March 16^TH, 2016 FOMC monetary policy meeting: 54% (on the fence.)
  
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• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the April 27^TH, 2016 FOMC monetary policy meeting: 61% (somewhat likely.)
  
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• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the June 15^TH, 2016 FOMC monetary policy meeting: 74% (somewhat likely.)
  
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• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the July 27^TH, 2016 FOMC monetary policy meeting: 79% (somewhat likely.)
  
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• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the September 21^ST, 2016 FOMC monetary policy meeting: 86% (likely.)
  
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• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the November  2^ND, 2016 FOMC monetary policy meeting: 89% (likely.)
  
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• Current odds that the Prime Rate (currently 3.5%) will rise by at least 25 basis points at the December  14^ND, 2016 FOMC monetary policy meeting: 91% (likely.)
  
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• NB: US Prime Rate = (The Fed Funds Target Rate + 3)

The odds related to fed fund futures contracts -- widely accepted as the best predictor of what the FOMC will do with the benchmark Fed Funds Target Rate -- are constantly changing, so stay tuned for the latest odds.

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