Is a rate cut locked in? The probability of a Fed move in December is close to 90%, and the market is celebrating early?

This morning, I came across some news that instantly gave the market a shot of confidence.

According to the latest data from CME’s “FedWatch,” the market is now betting that there’s an 89.4% chance the Federal Reserve will cut rates by 25 basis points in December.

In plain language: a December rate cut is basically a done deal. Nearly 9 out of 10 people think it’s going to happen.

The remaining 10.6% believe rates will stay put and the Fed will keep watching. As for a rate hike? The market isn’t even considering that option right now.

That’s not all. Looking ahead to January next year:
There’s a 68.5% chance of a cumulative 25 basis point rate cut.
Even more striking, the probability of a cumulative 50 basis point cut (that is, two cuts in a row) is 23.8%.

Simply put, the market consensus now is that the rate cut cycle may open up very soon—and the pace could be even faster than expected.

What does this mean for us?
Once liquidity expectations shift, it’s generally a long-term positive for risk assets like the stock market and crypto market. In theory, money becomes cheaper, and there could be more “liquidity” flowing in search of high-yield assets.

Looking at this morning’s BTC and ETH performance, while both are still consolidating, structurally (especially for ETH) they’re already showing some resilience. The market seems to be pricing in some optimism ahead of time.

Of course, even a high probability isn’t 100%—the final decision will still depend on the Fed’s meeting. But before that, the strong expectation of “a rate cut is coming” could already be propping up the market’s floor, or even quietly laying the groundwork for the next leg up.

In the days ahead, the market may enter a “speculation on expectations” phase. The winds really do seem to be shifting. #美联储降息预测