Question
On July 27 2022 the Fed has raised the Fed Funds Rate (FFR) by 75 basis points, from 1.75 percent to 2.50 percent. Analysts were
On July 27 2022 the Fed has raised the Fed Funds Rate (FFR) by 75 basis points, from 1.75 percent to 2.50 percent. Analysts were divided whether on the next Fed meeting, scheduled for Sep 21 2022, the decision will be a 50 bp raise or a 75 bp raise. On Sep 1, the October 30 Fed Funds Futures (FFF) contract was at 3.15.
What was the implied probability of a 50 BP raise vs. a 75 BP raise on that day?
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