Traders increase hedges as Fed-cut odds fall

Tuesday, November 18, 2025 at 12:45 UTC+01:00 (+0100), United States, New York

News category : Macroeconomic Events

On November 18, 2025 market participants pared back the probability assigned to a Federal Reserve rate reduction in December, responding to resilient data and shifting risk sentiment. The move saw increased flows into options and futures that protect against downside risk and prompted modest repricing in short-dated Treasury yields. Such shifts in policy expectations are root macro-financial events because they directly alter discount rates used for asset valuation and influence capital allocation decisions across equity and fixed-income markets.

Overall market impact

Light bearish market impact - strength score : 64/100

Detailed breakdown of market impact over instruments, sectors, and asset classes

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Impacted instruments :

Fed funds futures

10Y UST

Rate-sensitive equities

Short-dated options

Currency crosses (USD)

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