US retail sales for August released with 67% chance of Fed cutting rates by 50 bps

September 17, data released on Tuesday showed that U.S. retail sales unexpectedly rose in August, suggesting that the U.S. economy remained on solid footing for most of the third quarter. Institutional analysts commenting on the U.S. retail sales data said it was unlikely to have much impact on this week's FOMC policy report. Markets have been debating how big a rate cut the Fed will implement. With signs of a slowing labour market and inflation falling to the Fed's 2% target, markets have tended to price in a 50 basis point rate cut from the Fed. According to the CME's FedWatch tool, the likelihood of the Fed cutting rates by 50 basis points is 67 per cent, while the likelihood of the Fed opting for a smaller 25 basis point cut is 33 per cent.