Expectations for an emergency rate cut by the Federal Reserve have risen, with the probability of a 25 basis point rate cut next week reaching 40%.

Odaily News As the U.S. government's tariff policy has stoked fears of a global recession, traders have raised their bets for the Federal Reserve to cut interest rates this year, with some even seeing a reduction before the central bank's next meeting.
The overnight interest rate swap market shows that the market expects the Fed to cut interest rates by 125 basis points by the end of this year, equivalent to five 25 basis point rate cuts. Although this expectation has subsequently fallen back, the increase is very obvious. Compared with last week, the market has only fully digested the expectation of three rate cuts. The swap contract also shows that the probability of the Fed cutting interest rates by 25 basis points next week is about 40%, which is much earlier than the Fed’s next scheduled policy meeting on May 7. (Jinshi)