Dow Falls More Than 100 Points as Markets Await Fed's First Rate Hike in Over 2 Years

MacroDigital Finance Impact 4
โดย InfoQuest·US·Read original
Summary · why it matters

Wall Street stocks moved lower ahead of the US central bank's interest rate decision, which is expected to mark the start of a new rate-hiking cycle. As of 9:21 p.m. Thailand time, the Dow Jones Industrial Average was down 168.18 points, or 0.32%, at 51,924.93. The CME Group's FedWatch Tool indicates that investors are pricing in a 92.7% probability that the Fed will raise rates by 0.25% to a range of 3.75-4% at today's meeting, and a 7.3% probability that the Fed will hold rates steady. If the Fed raises rates as expected today, it would be the first hike since July 2023, and since then the Fed has cut rates six times, by a total of 1.75%. A month ago, investors assigned only a 36% probability to a Fed rate hike at the September 16 meeting. Economists at Morgan Stanley have revised their forecast from expecting no rate hikes this year to expecting two increases, one on September 16 and another in December. Michael Gapen, Morgan Stanley's chief economist, said inflation is still not slowing fast enough to give the Fed confidence that it can return to 2% within an appropriate timeframe.

Impact on stocks 4

Financials▲ · 1 stocks
Morgan Stanley
MS
± MixedMonetaryrelevance

Morgan Stanley economists revised their forecast to two rate hikes this year, but the article gives no clear directional impact on the firm itself.

Carbon Removal (DAC)▲ · 1 stocks
CME Group Inc
CME
▲ PositiveDemandrelevance

CME's FedWatch Tool is cited as the source pricing the 92.7% probability of a Fed hike, highlighting demand for its rate-probability products.

Others▲ · 2 stocks
％Effective Federal Funds Rate
EFFR
▲ PositiveMonetaryrelevance

Markets price a 92.7% probability the Fed raises rates 0.25% to 3.75-4%, pushing the effective federal funds rate higher.

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