As the September Federal Reserve monetary policy meeting approaches, market expectations for interest rate cuts are rising. However, whether this expectation will become a reality still requires careful consideration.

According to data from the Chicago Mercantile Exchange (CME), over 94% of market participants expect a rate cut in September, with the highest likelihood being a 25 basis point cut at a probability of 94.8%. A 50 basis point cut could only become a reality in the event of a significant deterioration in the job market, but the probability of this scenario is only 5.2%.

Looking back at the Federal Reserve meeting at the end of July, policymakers chose to keep interest rates unchanged, maintaining the target range for the federal funds rate at 4.25%-4.50%. Federal Reserve Chairman Powell is cautiously optimistic about the possibility of a rate cut in September, emphasizing the need to further observe economic data. Nevertheless, the market remains optimistic; while expectations for a rate cut have cooled somewhat, they have not completely disappeared.

The current economic situation in the United States is a mix of good and bad. On one hand, the overall economic performance is decent, but the job market shows signs of weakness. On the other hand, while the inflation rate is close to the 2% target, it has not fully met the goal. Additionally, political factors may also influence the Federal Reserve's decisions, and the uncertainty surrounding trade policies could become a potential factor driving interest rate cuts.

Overall, while the possibility of an interest rate cut in September is relatively high, the magnitude may be conservative. The market needs to closely monitor the upcoming employment data, as it could become a key factor influencing the Federal Reserve's decision. Regardless of the final outcome, this interest rate decision will have a significant impact on the financial markets, and investors should remain vigilant and be prepared for various possibilities.