NEW YORK, Aug 7 (Reuters) - U.S. short-term interest rates futures rose on Wednesday, as traders increased bets that the Federal Reserve would cut key borrowing costs three more times by year-end to combat rising recession risks due to trade tensions and softening global demand.
At 8:52 a.m. (1252 GMT), federal funds futures implied traders were fully positioned for the U.S. central bank to cut rates at its Sept. 17-18 policy meeting, with a 28% chance it might lower them by half a point, according to CME Group’s FedWatch program.
The fed funds contract suggested there was an 83% likelihood the Fed may follow a possible September cut with a quarter-point rate decrease in October.
The fed funds complex implied traders see a 53% probability the Fed may cut rates by another 25 basis points in addition to possible rate cuts in September and October.
Last week, the Fed policy-makers cut interest rates for the first time since 2008.
Reporting by Richard Leong; Editing by Bernadette Baum