US rate futures raise odds of further easing in October after Fed cut rates by 25 bps

NEW YORK (Reuters) -Futures on the federal funds rate, which measure the cost of unsecured overnight loans between banks, further raised the odds on Wednesday that the Federal Reserve will deliver another interest rate cut at the October meeting, with a 94.1% probability.

That was 71.6% before the Fed’s decision on Wednesday to cut interest rates by 25 basis points to the 4.00%-4.25% range. In a statement, policymakers indicated it will steadily lower borrowing costs for the rest of this year, as policymakers responded to concerns about weakness in the job market

U.S. rate futures factored in more than 60 basis points in rate cuts in 2025 after the Fed statement.

(Reporting by Gertrude Chavez-Dreyfuss)