FED Rate Hike Odds Climb Ahead of FOMC Meeting in September

Market pricing for the Federal Reserve’s next move has shifted upward ahead of the September 15–16 FOMC meeting. After Fed chair Kevin Warsh’s Jackson Hole speech, the probability of a September rate hike rose from about 33% to roughly 66%, later around 64%. Economist Steve Hanke put the chance closer to 80%. Kalshi traders saw a 55% likelihood of a 25-basis-point hike, and only 2% expected an increase larger than 25 basis points, while the odds of no change were cited at 46%. Traders are weighing this week’s U.S. jobs data—JOLTS, ADP, and Friday’s nonfarm payrolls and unemployment—alongside upcoming PPI and CPI, with geopolitical tensions and oil prices adding caution.