US CPI inflation rises to 3.4% in August, pushing odds of September Fed rate hike to 79% and reversing prior rate-cut expectations.
Macro & Markets ·
US CPI inflation reached 3.4% in August, shifting market expectations dramatically as traders now price a 79% probability of a Federal Reserve rate hike in September, reversing earlier forecasts for continued rate cuts this year. The persistent inflation reading has rekindled "higher for longer" pricing across markets, marking a sharp reversal from the start of 2026 when rate cuts were anticipated.