Traders in interest rate futures shrugged off the report of faster inflation, setting 97% odds that the Fed after a two-day meeting on Sept. 20 will hold the federal funds rate at the current level, according to the CME FedWatch Tool. Last week they saw 92% odds that the central bank will stand pat.
The Fed in July raised the benchmark interest rate to a range between 5.25% and 5.5%, a 22-year high. The central bank paused monetary tightening in June to assess the impact from 10 consecutive hikes since March 2022.
