Over 86% Chance Fed Holds Rates Steady in January – Market Outlook Analyzed

Fed Likely to Stay Put in January, Eyes Turn to March

Recent market projections indicate an 86.2% probability that the Federal Reserve will keep interest rates unchanged in January. This reflects a cautious stance amid ongoing assessments of inflation trends and economic resilience.

Rate Cuts Pushed Toward Spring

While expectations for looser monetary policy persist, the timing has shifted. By March, there's a 38.0% chance of a cumulative 25-basis-point rate cut, while the likelihood of no change remains high at 57.4%.

• 25-basis-point cut in January: 13.8% chance
• Cumulative 25-basis-point cut by March: 38.0%
• 50-basis-point cut by March: only 4.6%

These figures suggest the Fed is holding back on policy shifts despite easing inflation. Traders are closely watching labor reports, core PCE data, and global economic developments to gauge the next move. For now, a wait-and-see approach dominates, signaling limited near-term volatility in rates.