Wall Street Sees Bigger Shock if Fed Holds Rates Steady - Seoul Economic Daily

Attention is turning to whether the U.S. Federal Reserve will begin a full tightening cycle with a rate increase this month. Markets now treat a September hike as all but certain and are looking ahead to the possibility of further increases. Analysts say that if the Fed delays again in September and is later forced into rapid back-to-back hikes, markets could face even greater turmoil. The probability of a September rate increase priced into futures markets topped 90% as of the 14th, according to CME FedWatch. That is nearly triple the roughly 30% seen a month earlier, meaning markets now view a hike this month as effectively settled.