### Traders Adjust Expectations Amid October PCE Inflation Data

Following the release of the October PCE inflation figures, which aligned with Wall Street's forecasts, traders in the fed-funds-futures market have slightly shifted their outlook. The fresh data appears to diminish the likelihood that Federal Reserve policymakers will pause rate cuts next month.

Ian Lyngen, a rates strategist at BMO Capital Markets, analyzed the latest figures, noting in a statement to clients that the data does not seem to influence the Federal Reserve's stance on a potential rate cut or pause in December.

According to the CME FedWatch Tool, the market now perceives a 66.5% chance of a 25 basis point reduction in the fed-funds rate on December 18. This is an increase from a 59.4% probability noted earlier on Tuesday.

It is important to correct a prior news alert that inaccurately mentioned a forecast for a rate hike in December by the fed-funds market. In reality, the futures market points to a 66% probability of an interest rate cut.