September Fed Hike Odds Hit 57% as Brent Oil Jumps 2% Above $90
Updated
Updated · Yahoo Finance · Aug 31
September Fed Hike Odds Hit 57% as Brent Oil Jumps 2% Above $90
3 articles · Updated · Yahoo Finance · Aug 31
Summary
Markets raised the implied chance of a September Fed rate increase to 57%, pushing short-term Treasury yields higher and flattening the U.S. yield curve.
Brent crude climbed 2% to above $90 a barrel after U.S. forces struck two Iranian launchers on Larak Island and Iran hit U.S. forces in Jordan and said it struck a tanker in the Strait of Hormuz.
Kevin Warsh's hawkish Jackson Hole speech reinforced inflation fears from higher energy prices; Barclays now expects 25-basis-point Fed hikes in both September and December, though JPMorgan still sees the first move in December.
Germany's 2-year yield reached its highest since July 2024 and Japan's 2-year yield a 31-year high, while stocks stayed cautious, with the STOXX 600 edging lower and U.S. futures slightly weaker.
Friday's U.S. payrolls report and Sept. 11 CPI data are now the key tests for whether the Fed tightens next month; economists expect 58,000 jobs added and unemployment steady at 4.1%.