CBOT Fed Watch - October 31 Market Close

Based upon the October 31 market close, the CBOT 30-Day Federal Funds futures contract for the November 2005 expiration is currently pricing in a 100 percent probability that the FOMC will increase the target rate by at least 25 basis points from 3-3/4 percent to 4 percent at tomorrow’s FOMC meeting.

In addition, the CBOT 30-Day Federal Funds futures contract is pricing in a 2 percent probability of a further 25-basis point increase in the target rate to 4-1/4 percent (versus a 98 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 Tuesday, December 6, one full week prior to the next scheduled FOMC meeting on December 13.

Summary Table
October 25:  0% for No Change versus 100% for +25 bps.
October 26:  98% +25 bps versus 2% for +50 bps.
October 27:  98% +25 bps versus 2% for +50 bps.
October 28:  98% +25 bps versus 2% for +50 bps.
October 31:  98% +25 bps versus 2% for +50 bps.
November 1:  FOMC decision on federal funds target rate.