CME FedWatch
A CME tool that converts 30-day Fed Funds futures prices into market-implied probabilities of Fed rate moves at upcoming FOMC meetings.
CME FedWatch is a widely cited tool that translates prices in the 30-day Federal Funds futures market into the market-implied probability of each possible federal funds target range at upcoming FOMC meetings. Because Fed Funds futures settle to the average daily effective fed funds rate over their contract month, their prices encode the market's collective bet on what the Fed will do.
The tool expresses these bets as probabilities — for example, "72% chance of a 25bp cut" at the next meeting. Traders, journalists, and the Fed itself use it as a real-time consensus of rate-path expectations. When economic data or Fed speak shifts those odds, the move shows up in FedWatch within minutes and ripples into the front end of the yield curve.
The practical caveat: FedWatch shows probabilities priced by the market, not a forecast of what the Fed should do — and the math embeds assumptions about meeting timing and any small risk premium in the futures. It is a measure of positioning and expectation, best read alongside the Fed's own dot plot.