Will The Fed Raise Rates This Week? What About Later This Year? #themorningfilter #thefed

We've got a Federal Reserve meeting on the docket this week. So, tell us what investors should be expecting there and, you know, what are the odds that we'll see a rate hike again? >> Well, the odds are pretty low that we're going to see a rate hike this month. So, I think the market right now is only pricing in about a 9% probability of a hike here in October, but that increases to well over 75% of a probability of at least one hike and potentially even two, you know, by the time we get to, you know, December. You know, looking into next year, the market is still pricing in more yet more cuts, you know, yet to come. Uh looking at December 2027, it's pricing in a 50% probability that the fund Fed funds rates ends next year at over 4 and 1/2%. So, that's at least one more hike after this one, if not even, you know, potentially more. Now, I know our economist is still only looking for the one rate hike this year. He thinks that that will be the end of this tightening cycle. And in fact, he thinks that by the end of next year in 2027, we'll probably start seeing the Fed begin to cut rates. And I think really the thought process there is that we'd be looking for a slowing rate of increase in new CapEx spending on AI. And as such, that would then have some negative implications, you know, on the economy overall. So, by the end of 2027, we might be in the position of the economy slowing too much. You know, the Fed may start, you know, going the other way. And we do have PCE coming out this week. However, it comes out on Thursday. So, essentially a day late dollar short because that's after the Fed will have already, you know, made its decision. So, that print in and of itself not all that important, not going to impact, you know, this Fed meeting. But at least, you know, we'll have several more inflationary indicators coming out before the December Fed meeting to try and gauge what they might do at that point.