July 3 U.S. short-term interest-rate futures
contracts fell Thursday after a government report showed
stronger-than-expected job growth in June, as traders boosted
bets the Federal Reserve may raise rates sooner than previously
The contracts show markets are assigning a roughly 55 chance
of a first Fed rate hike in June 2015, based on CME FedWatch,
which tracks rate hike expectations using its Fed funds futures
contracts. Before the report traders saw a 52 percent chance of
a June 2015 rate hike.
Immediately after the report traders saw a 42 percent chance
of a rate hike in April 2015, up from 38 percent before the
The Fed has targeted short-term rates of between zero and
0.25 percent since December 2008, and has promised to keep them
there for a "considerable time" after it ends its bond-buying
program. Its bond-buying program is on track to end this fall.
(Reporting by Ann Saphir Editing by W Simon)