FedWatch shows 25 bps hike in September still priced in

Market expectations for a potential 25 basis-point increase in the Federal Reserve’s benchmark interest rate in September remain firmly embedded in FedWatch tools, according to the latest pricing data. The indicator, which tracks the probability of rate moves based on Treasury yields, suggests a significant portion of traders still anticipate a hike, though the debate over whether it will be the final one in the current cycle persists. Analysts at Kitco and Natixis have framed the question as a potential ‘one-and-done’ move, contingent on whether incoming inflation data moderates sufficiently to justify a pause or further tightening.