Traders tend to bet that the Federal Reserve will cut interest rates only once in 2025

Traders are reportedly increasingly betting that the Federal Reserve will cut interest rates only once this year amid signs of resilient economic growth and lingering inflation. U.S. CPI data for May will be released on Wednesday and is expected to pick up, strengthening the central bank's wait-and-see attitude towards further easing of monetary policy as it assesses the impact of tariffs. The Fed is widely expected to keep interest rates steady next week, and futures and options tracking expectations for the Fed's policy path show traders are moving to unwind the premium on rate cuts in the coming months. Swap traders now expect a rate cut of about 0.45 percentage points before the end of the year, the smallest cut they expect since President Trump announced higher tariffs in early April.