Implied yields on federal funds futures are an indication of the average expected future funds rate. As such, they also measure the average expectation of future monetary policy actions. Starting in late February, the marginal participant in federal funds futures markets seems to have been hedging against future rate increases, but without much conviction; at the end of April, the implied yield for the September future was only seven basis points above the current target rate of 4.75%.
Suggested citation: "Monetary Policy," Federal Reserve Bank of Cleveland, Economic Trends, no. 99-05, pp. 02-05, 05.01.1999.