Tomorrow’s FOMC announcement is widely expected to result in a 25bp hike to the Fed Funds Target Rate. Specifically, the derivative markets are pricing in a 98.9% chance of 25bp tomorrow. Finally, the current market expectation is for another 25bp hike in March with an 85% chance of that currently priced by the market.
Now that we have daily index options, trading around macro events is much easier than in the past. We have been exploring macro events such as the FOMC or major economic…
