MONEY MARKETS-Traders see higher chances of U.S. rate cut in Sept
NEW YORK, May 15 (Reuters) – U.S. interest rates futures added to their earlier gains on Wednesday as an unexpected fall in domestic retail sales in April stoked traders’ expectations that the Federal Reserve may lower borrowing costs in September to combat a slowing economy.
At 8:31 a.m. (1231 GMT), federal funds futures implied traders saw a 56% chance the U.S. central bank may lower its target range on short-term rates by a quarter point to 2.00%-2.25% at its September policy meeting, up from 46% late on Tuesday, according to CME Group’s FedWatch program.
Fed funds contract suggested traders placed a 75% chance of a quarter-point cut at the Fed’s December policy meeting, compared with 70% late on Tuesday. (Reporting by Richard Leong Editing by Nick Zieminski)
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