The probability of the Federal Reserve cutting interest rates in January is only 14.9%, but the cumulative expectation of rate cuts in Q1 has surpassed the 50% mark.

HashBandit · 2026-01-02T00:12:12+00:00

According to CME data, the probability of the Federal Reserve cutting interest rates by 25 basis points in January is only 14.9%, and the market expects interest rates to remain unchanged. However, by the end of March, the probability of a 25 basis point rate cut rises to 51.2%, indicating that market expectations for rate cuts are gradually strengthening. Investors should pay attention to the impact of interest rate changes on risk assets.

HashBandit

2026-01-02 00:12:12

Abstract generation in progress

【Chain News】According to the CME Federal Funds Futures data reflecting market expectations, the probability of the Federal Reserve cutting interest rates by 25 basis points in January is relatively low at only 14.9%. The market mainly expects to maintain the current interest rate level, with this scenario accounting for 85.1%.

However, looking at the longer term, the situation changes. By the end of March, the market’s expectation of a cumulative 25 basis point rate cut by the Federal Reserve rises to 51.2%, surpassing half; meanwhile, the probability of keeping rates unchanged drops to 42.8%. Additionally, there is a 5.9% small probability that the Fed will cut rates by a total of 50 basis points during this period.

This reflects a divergence in market views on the Federal Reserve’s policy trajectory—maintaining a tightening stance is more likely in the short term, but as economic data is gradually disclosed, expectations for rate cuts have warmed in the latter half of Q1. For crypto assets, interest rate changes directly affect the attractiveness of risk assets, so investors should closely monitor these probability shifts.

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.

15 Likes

Reward
15
4
Repost
Share

Comment

0/400

YieldChaser

· 12h ago

Still squeezing toothpaste in the short term, Q1 is the real highlight... With a 51.2% chance of interest rate cuts, we'll have to wait until the middle or later stages for this wave.

View OriginalReply0

FortuneTeller42

· 12h ago

January is most likely not to drop, just wait and see, there will be opportunities in Q1 --- So it still depends on economic data, probabilities are too unpredictable --- Short-term retail investors continue to be locked out, only in the mid-term is there a chance to turn around? Truly impressive --- Listening to the 51.2% figure is just for reference; CME and other data change very quickly --- Interest rates are indeed a critical factor in the crypto world, no wonder everyone is watching the Federal Reserve every day --- The logic is to first resist the decline and then wait for a rebound, but the problem is surviving until mid-Q1 --- A 50 basis point cut of 5.9%... that kind of probability doesn't match up with expectations --- We need to get through January first; talking about these now is just pointless

View OriginalReply0

BearMarketBard

· 12h ago

January is definitely a Hold, but there's a chance for a turnaround in Q1... We'll know once the economic data is released.

View OriginalReply0

OnchainDetective

· 12h ago

The probability of staying put in January is very high, but the chance of a rate cut in Q1 is over 50%. This wave of market行情确实分化啊 --- Short-term defense, long-term easing. The Federal Reserve's套路老套了. Still, we need to look at economic data to speak --- 85% probability of no cut. This is the hard reality right now. Don't be fooled by the 51% chance of a rate cut in Q1 --- The 5.9% double cut probability is interesting. If it really happens, the crypto market could take off --- Interest rate policies have always been a风向标 for crypto. Hold on, everyone

View OriginalReply0