Analysis Suggests High Probability of Fed Holding Rates Next Week; Only Specific Geopolitical De-escalation Could Trigger Hike

English summary

The market widely expects the Federal Reserve to hold interest rates steady at its October 28 meeting. Despite hot CPI data, priced-in hike probabilities are minimal, reflecting restored confidence in the Fed's credibility and current financial conditions. A rate hike is considered highly unlikely unless an unexpected peace deal with Iran causes oil prices to plunge and long-term yields to fall.