CME Group FedWatch June hike probability jumped above 70% post-Fed

Following today's Fed decision and the monetary policy statement, the probability of a rate hike in June leaped to 71.6% from 67.6% according to the CME Group FedWatch tool, which calculates unconditional probabilities of Federal Open Market Committee (FOMC) meeting outcomes to generate a binary probability tree.

Although the Federal Reserve kept rates unchanged at its May meeting, the monetary policy statement suggested that it remains on track for its second rate hike of the year in June as the recent slowdown in the economic activity was seen as temporary and the labor market continued to show improvement. Following the statement, the US Dollar Index reached its highest level since last Thursday at 99.15. The 10-year U.S. T-bond yield jumped above 2.3% and is now at 2.315%, up 0.8% on the day.

• FOMC's decisions regarding monetary policy implementation - May 3, 2017