Fed Rate Hike Odds Plummet to 17% in October Amid Weak Jobs Report
Investors now believe it's highly unlikely that the Federal Reserve will raise interest rates again in October, following a weaker-than-expected September employment report. The jobs added in September were only 29,000, below estimates of over 80,000.
The CME's FedWatch tool shows that there's only a 17% chance that the Fed increases rates by a quarter percentage point in October, down from 36% just one week ago. On prediction market platform Kalshi, chances for a hike in October stood at just 18%, down from almost 70% a week ago.
The US economy's slower-than-expected growth has led some to think that the Fed may want to reconsider its rate hikes. 'This report strengthens the case for the Federal Reserve to remain patient,' said Adam Schickling, a senior economist at Vanguard.