rate cut odds are climbing

in response to today's very weak economic news and cumulative evidence of both economic weakness and continued strains in the financial system, rate cut odds have increased again.

the market is now priced for 60% odds that the fed will lower the fed funds rate by 75 basis points at the March 18 fomc meeting, up from 36% odds yesterday and 0% odds a week ago when the market was priced for 94% odds of a 50-basis-point cut.

for the april 30 fomc meeting, the market is priced for 100% odds of a cumulative 75 basis points in cuts and 84% odds of a cumulative 100 basis points in cuts (a 2% funds rate), up from 48% odds yesterday.

for the june 25 fomc meeting, the market is priced for 100% odds of 100 basis points in cumulative cuts, and 38% odds of 125 basis points in cumulative cuts, up from 2% odds yesterday.