CME data shows traders have balanced bets between 50 basis points and 25 basis points in rate cuts over the past few hours

With the Fed's interest rate decision looming, the outcome looks even more uncertain. In the past few hours, traders have placed a more balanced bet between a 50 basis point cut (currently about 55% probability) and a 25 basis point cut (45% probability), according to CME. A 50 basis point cut was still favored by a 2:1 probability margin earlier on Wednesday, but the more conservative option of a 25 basis point cut has gained more support due to strong economic data. Treasury yields are rising as the likelihood of a sharp rate cut decreases. The yield on two-year Treasury bonds is currently at 3.657%, compared with 3.59% at Tuesday's close.