Based upon the January 29th market close in the February 2002 expiration, the Chicago Board of Trade 30-Day Federal Funds futures contract is currently pricing in a 10 percent probability that the Federal Open Market Committee will lower the federal funds target rate by at least 25 basis points from 1-3/4 percent to 1-1/2 percent at tomorrow's FOMC meeting (versus a 90 percent probability of no rate cut).
Summary Table
January 23: 80% for No Change versus 20% for -25 bps.
January 24: 88% for No Change versus 12% for -25 bps.
January 25: 92% for No Change versus 8% for -25 bps.
January 28: 94% for No Change versus 6% for -25 bps.
January 29: 90% for No Change versus 10% for -25 bps.
January 30: FOMC decision on federal funds target rate.
