#WarshFedPolicyOutlook 🚨 RATE CUT ODDS ARE MOVING — AND MARKETS ARE WATCHING CLOSELY
Traders are starting to reposition.
The probability of a March rate cut just climbed to 23%, up from 18.4% on Friday, according to CME FedWatch. That’s a meaningful shift in a short time — and it signals growing unease beneath the surface. $F
What’s driving it?
👉 Rising concerns that Kevin Warsh, a potential Fed chair, could take a more hawkish stance, tightening financial conditions faster than expected.
Right now, markets are only pricing in: $DUSK
• One 25 bps cut
• No larger or accelerated easing
That tells us something important:
📉 Growth fears are creeping in
📈 But the Fed still isn’t seen as fully pivoting
This is a fragile setup.
If economic data weakens further, rate-cut expectations can jump fast.
If inflation sticks, the Fed stays restrictive — and risk assets feel the pressure.
⚠️ Volatility thrives in moments like this.
The next few data points could flip the narrative quickly.