Fed Rate Cut Odds Hit 98.3% After October 2025 Market Crash: Investor Guide
The U.S. stock market is reeling from a sharp selloff on October 10, 2025, triggered by President Donald Trump’s announcement of “massive” new tariffs on Chinese imports, escalating Trade War 2.0 fears. The S&P 500 plunged 2.71%, the Nasdaq dropped 3.56%, and the Dow fell 1.90%—its worst day since April—wiping out weekly gains and sending the VIX volatility index to its highest close since June. Tech giants like Nvidia and AMD tumbled over 5%, while rare earth stocks surged on supply chain jitters. Against this backdrop, the odds of a Federal Reserve rate cut at its October 28-29 meeting have skyrocketed to 98.3% according to CME FedWatch data, up from around 96% just days ago. This near-certainty reflects the Fed’s growing concerns over a softening labor market, exacerbated by the government shutdown delaying key jobs data and tariff-induced economic uncertainty. In this post, we’ll break down why probabilities jumped, what it signals for the economy, and—crucially—ho...