Market operators now place a 58.4% probability on a 25 basis point rate hike at the Federal Reserve’s upcoming FOMC meeting, which concludes on September 16. August employment data showed 162,000 jobs added with unemployment steady at 4.1%, while inflation remains at 3.4%, significantly above the Fed’s 2% target. Major banks including Macquarie, Bank of America, and UBS forecast hikes as early as next week, with UBS anticipating two increases this year. Meanwhile, the Trump administration is escalating pressure for rate cuts, with the president threatening to halt trade with countries running trade deficits with the United States. JD Vance also urged the Fed to lower rates to improve homeownership affordability for Americans.
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