Odds At 4% (Very Unlikely) The U.S. Prime Rate Will Rise At The June 15, 2016 FOMC Monetary Policy Meeting

Prime Rate Forecast

Latest Prime Rate Forecast

As of right now, the investors who trade in fed fund futures via the CME Group have odds at 4% (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 June 15^TH, 2016 monetary policy meeting (very unlikely.)

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

NB: U.S. Prime Rate = (The Fed Funds Target Rate + 3)

===

It seems that the American consumer has enough financial confidence to spend, as evidenced by a sharp increase in revolving debt during March, and healthy reports on retails sales and consumer sentiment.

But most rate watchers are betting that the Fed won't raise short-term rates at the next FOMC meeting.  The U.S. economy grew at an anemic 0.5% during the first quarter of this year, based on the Commerce Department's advance estimate, and the latest readings on jobs and jobless claims, while not devastating, were not very encouraging either.  Most are betting that the Fed doesn't want to do anything to choke off this still lethargic economic recovery, especially while core inflation remains below 2%.

=======================

Current Odds

• 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: 4% (very unlikely.)
  
  ========
• 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: 20% (not likely.)
  
  ========
• 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: 39% (not likely.)
  
  ========
• 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: 43% (on the fence.)
  
  ========
  
  
• NB: United States Prime Rate = (The Fed Funds Target Rate + 3)

The odds associated with 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.

--> www.FedPrimeRate.com Privacy Policy <-- >  SITEMAP  <