Federal Reserve, over 85% chance of holding interest rates steady in January

LidoStakeAddict · 2026-01-21T16:07:58+00:00

Market forecasts indicate an 85% chance the Federal Reserve will maintain interest rates in January, with less than 15% likelihood of a 25bp cut. Expectations suggest a cautious policy stance will persist.

LidoStakeAddict

2026-01-21 16:07:58

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According to the latest market forecasts, the Federal Reserve has a greater than 85% chance of maintaining the current interest rate at the January decision. Conversely, the probability of a 25bp cut is assessed to be less than 15%.

Data from CME’s official indicator, the FedWatch tool, has made the Federal Reserve’s next month’s rate trajectory clearer. The cumulative outlook until March shows a 51% probability of a 25bp cut, a 43% probability of holding steady, and a 6% probability of a 50bp cut.

This suggests that the Federal Reserve is likely to remain on hold without raising interest rates for the time being. Among market participants, the expectation that the Fed’s cautious policy stance will continue remains dominant.

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