Only a 4.4% Probability That the Fed Lowers Rates in January, With the Initial Reduction Expected in June

Federal Reserve Rate Cut Outlook for 2026

Should these projections hold, anticipate strong reactions from Trump as the month progresses.

chart The chart above was created in Excel using a weighted average of CME Fedwatch's interest rate forecasts. The likelihood of a rate reduction in January is extremely slim.

chart As of January 11, 2026, the probability of a rate cut this month stands at just 4.4%. The market does not expect the first quarter-point reduction until the Federal Open Market Committee meets on June 17. A second quarter-point decrease is largely anticipated by the October 28 meeting, and is fully factored in by December 9, with no further cuts expected.

Recent reports from Bloomberg suggest that U.S. inflation may accelerate following a confusing November CPI release.