Deduction from the Fed's interest rate cut:

1. Time node
There are two key time points for a rate cut: the Fed rate meeting on September 18 and November 7.
US election time is November 5, unofficial results will be announced that night or the next day, while official results will be announced at the end of the year.
2. Interest rate reduction data
According to CME's data of the day, while there was no 30.6 percent interest rate cut on September 18, a 2.5 basis point interest rate cut was 57.2 percent, and a 5 basis point interest rate cut was 12 percent. The overall expected probability of a rate cut is 69.4%.
The probability of no interest rate cut on November 7 is 17.8%, the probability of a 2.5 basis point interest rate cut is 46.5%, the probability of a 5 basis point interest rate cut is 30.6% and the probability of a 7.5 basis point interest rate cut is 30.6%. happened. point interest rate reduction became 5 percent. The overall expected probability of a rate cut is 82.4%.
3. Interest rate deductions
Considering the situation of the US elections, which are two days away from the interest rate cut in November, if the interest rate cuts start in November and the benefits are implemented, the collapse of the financial market during the election will cause fluctuations in the markets and affect the election results.
If interest rates are lowered in September, there are still two months until the November elections. Even if the US stock market crashes and pulls back, there will be enough time during the election to digest short-term bubbles and ensure stable stock market performance.
4. Conclusion
According to the above, the possibility of an interest rate cut is at its highest starting from September.