Federal Reserve Rate Hike Expectations Rise Amid Inflation Data
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 18 2026
0mins
Source: CNBC
- Inflation Data Impact: February's wholesale inflation exceeded expectations with the producer price index (PPI) posting its largest annual gain, leading traders to reassess the likelihood of Federal Reserve rate cuts, effectively ruling them out for the year.
- Rate Decision Outlook: According to CME's FedWatch tool, the probability of a June rate cut has dropped to 18.4%, with July at 31.5% and September at 43.6%, indicating a significant decline in market confidence regarding future cuts amid persistent inflation pressures.
- Fed's Stance Shift: Economist Eugenio Aleman noted that today's FOMC statement may lean towards a 'higher for longer' approach, suggesting that even if rates remain unchanged, multiple dissents could indicate a hawkish tone within the committee.
- Market Expectation Volatility: While the probability of a December cut stands at 60.5%, the market's conviction is relatively low; historically, probabilities above 60% have been associated with Fed policy changes, and future economic developments could further influence these expectations.
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Analyst Views on CME
Wall Street analysts forecast CME stock price to fall
10 Analyst Rating
4 Buy
4 Hold
2 Sell
Hold
Current: 297.580
Low
209.00
Averages
285.90
High
320.00
Current: 297.580
Low
209.00
Averages
285.90
High
320.00
About CME
CME Group Inc. provides a derivatives marketplace. The Company enables clients to trade futures, options, cash and over the counter (OTC) markets, optimize portfolios, and analyze data. It exchanges offer a range of global benchmark products across all major asset classes based on interest rates, equity indexes, foreign exchange (FX), energy, agricultural products and metals. It offers futures and options on futures trading through the CME Globex platform, fixed income trading via BrokerTec and FX trading on the EBS platform. In addition, it operates central counterparty clearing provider, CME Clearing. Its products provide a means for hedging, speculation and asset allocation related to the risks associated with, among other things, interest rate sensitive instruments, and changes in the prices of agricultural, energy and metal commodities. It provides clearing and settlement services for a range of exchange-traded futures and options on futures contracts and OTC derivatives.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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