What are the interest rate expectations for G8FX?

Rate cuts by year-end

• Fed: 86 bps (90% probability of no change at the upcoming meeting)
• ECB: 60 bps (79% probability of rate cut at the upcoming meeting)
• BoE: 88 bps (97% probability of rate cut at the upcoming meeting)
• BoC: 43 bps (61% probability of no change at the upcoming meeting)
• RBA: 121 bps (96% probability of rate cut at the upcoming meeting)
• RBNZ: 82 bps (94% probability of rate cut at the upcoming meeting)
• SNB: 28 bps (74% probability of rate cut at the upcoming meeting)

Rate hikes by year-end

• BoJ: 17 bps (97% probability of no change at the upcoming meeting)

There hasn’t been much change since Friday as the markets continue to wait for more concrete info on the trade negotiations front. The most likely countries for the first deal (or at least an agreement of understanding) include India, South Korea and Japan. All three of them have reciprocal tariffs above the 20% rate, which got lowered to 10% for the 90-days pause.

This article was written by Giuseppe Dellamotta at www.forexlive.com.