Traders spent this week repricing the Federal Reserve.
The implied probability of an interest rate increase at next Wednesday’s meeting climbed from roughly a coin flip to about 90% after back-to-back inflation reports left little room to argue that price pressures are fading.
Crude Above $100 Is Doing The Damage
Thursday’s producer price index showed initial signs of weakness, with the annual rate quickening to 5.4% from 4.8%.
Friday’s consumer price index held the headline rate at 3.4% year-over-year, but the details mattered more: core prices, which strip out food and energy, advanced 0.3% month-over-month, above forecasts of 0.2%.
