CME FedWatch Adjusts to Warsh's New Focus on Economic Data

New changes are coming to CME FedWatch, a tool used to gauge interest rate expectations, following the first major address by new Federal Reserve Chairman Kevin Warsh.

The address was delivered at the Fed's summer symposium last week. While the Fed did not meet in August, it is scheduled for this month on the 15th and 16th, with any rate decision to be made early afternoon on the 16th.

In his speech, Warsh reiterated a theme he has been promoting - shifting focus from the Fed itself towards economic data and market responses. However, current economic data shows that inflation remains above the 3.5% mark, which is higher than the Fed's target of 2%.

The updated CME FedWatch tool now indicates a 43% chance of no change in rates over two weeks, while a 57% chance points to a quarter-point rate hike.