FOMC increased interest rates in March and June and increased its forecast from three rate hikes in 2018 to four rate hikes. June decision was unanimous. Current Federal funds rate - 175-200 bps (Note, all calculations are based on data as of 24th September)

• September 2018 meeting: Market is attaching 92 percent probability that rates will be at 2.00-2.25 percent, and 8 percent probability that rates will be at 2.25-2.50 percent.
  
• November 2018 meeting: Market is attaching 92 percent probability that rates will be at 2.00-2.25 percent, and 8 percent probability that rates will be at 2.25-2.50 percent.
  
• December 2018 meeting: Market is attaching 12.8 percent probability that rates will be at 2.00-2.25 percent, 80.3 percent probability that rates will be at 2.25-2.50 percent, and 6.9 percent probability that rates will be at 2.50-2.75 percent.
  
• January 2019 meeting: Market is attaching 12.2 percent probability that rates will be at 2.00-2.25 percent, 77.4 percent probability that rates will be at 2.25-2.50 percent, and 10.3 percent probability that rates will be at 2.50-2.75 percent.
  
• March 2019 meeting: Market is attaching 5.9 percent probability that rates will be at 2.00-2.25 percent, 43.8 percent probability that rates will be at 2.25-2.50 percent, and 44.9 percent probability that rates will be at 2.50-2.75 percent, and 5.5 percent probability that rates will be at 2.75-3.00 percent.
  
• May 2019 meeting: Market is attaching 5.2 percent probability that rates will be at 2.00-2.25 percent, 39.2 percent probability that rates will be at 2.25-2.50 percent, and 44.7 percent probability that rates will be at 2.50-2.75 percent, and 10.9 percent probability that rates will be at 2.75-3.00 percent.
  
• June 2019 meeting: Market is attaching 2.8 percent probability that rates will be at 2.00-2.25 percent, 23.3 percent probability that rates will be at 2.25-2.50 percent, and 42.2 percent probability that rates will be at 2.50-2.75 percent, 26.2 percent probability that rates will be at 2.75-3.00 percent, 5.5 percent probability that rates will be at 3.00-3.25 percent.
  

The probability is suggesting,

• Since our last review a week ago, the probabilities have tightened for far months.
• The market is pricing the third hike for 2018 in September and pricing it with 100 percent probability, same as a week ago.
• The market is pricing the fourth hike in December with 87.2 percent probability compared to 80.3 percent a week ago.
• The first rate hike of 2019 is now brought forward by the market from June to March. The market is pricing the possibility of a rate hike in March next year with 50.4 percent probability.
• The possibility of a second hike in June is priced with 31.7 percent probability.