rate cut odds - 100 bp cut possible

the market is priced for the possibility that the fed will lower the federal funds rate by 100 basis points at next tuesday's fomc meeting, placing odds at 40%, up from 0% odds thursday when the market was priced for 88% odds of 75 basis points in cuts only.

for the 4/30 fomc meeting, the market is priced for 100% odds of a cumulative 100 basis points in cuts and for 74% odds of a cumulative 125 basis points in cuts (a 1.75% funds rate).

for the 6/25 fomc meeting, the market is priced for 100% odds of a cumulative 125 basis points in cuts and for 36% odds of a cumulative 150 basis points in cuts.

for the end of 2008, the market is priced for the funds rate to move down to 1.60%, down from expectations for a rate of 1.78% thursday.