Betting markets now price in an 80% probability of a September rate hike as August CPI data reveals inflation remains a significant threat to the U.S. economy.
Citigroup economists are quoted discussing Fed rate hike odds, but the article is not about the company's performance.
Market expectations for a Federal Reserve interest rate hike have spiked to over 80% after August inflation data showed a 3.4% annual increase. Despite the current 3.75% Fed Funds Rate, rising mortgage costs and Treasury yields suggest the central bank may be forced to tighten policy again to curb persistent price pressures.
Mortgage rates are climbing because they are influenced by Treasury yields, which have been rising in anticipation of persistent inflation and potential further Fed tightening.