A Fed Pause in June, Hike in July, Then Nothing Till 2024?

The market sees a 98 percent chance of a pause in interest rate hikes by the Fed this afternoon. Then what?

Those are the weighted interest rate odds based on CME FedWatch data that reflect futures positioning of traders. 

In March, rate hike odds plunged on three regional bank failures. 

Since March, traders finally came to believe higher for longer.  For January and March of 2024 the market priced in five more quarter-point hikes than in March of 2023.

Assuming the Fed hikes in July, the market then does not expect a full quarter-point cut until January of 2024.

These numbers may change a great deal depending on what the Fed says this afternoon or when the Fed publishes the full minutes of the meeting in a couple weeks.