Based upon the May 9market close, the CBOT 30-Day Federal Funds futures contract for the May 2006expiration is currently pricing in a 100 percent probability that the FOMC will increase the target rate by at least 25 basis points from 4-3/4 percent to 5 percent at tomorrow’s FOMC meeting.
In addition, the CBOT 30-Day Federal Funds futures contract is pricing in a 7 percent probability of a further 25-basis point increase in the target rate to 5-1/4 percent (versus a 93 percent probability of just a 25-basis point rate increase).
This notification concludes this CBOT Fed Watch period. The next scheduled CBOT Fed Watch period will start on Thursday, June 22, one full week prior to the conclusion of the next scheduled FOMC meeting on June 29.
Summary TableMay 3: 81% for +25 bps versus 19% for +50 bps.
May 4: 82% for +25 bps versus 18% for +50 bps.
May 5: 84% for +25 bps versus 16% for +50 bps.
May 8: 91% for +25 bps versus 9% for +50 bps.
May 9: 93% for +25 bps versus 7% for +50 bps.
May 10: FOMC decision on federal funds target rate.
The information in this document, although taken from sources believed to be reliable, does not constitute investment advice and is not guaranteed by the Chicago Board of Trade as to its accuracy or completeness, nor any trading result, and is intended for purposes of information and education only. The Rules and Regulations of the Chicago Board of Trade should be consulted as the authoritative source of all current contract specifications and regulations.
