Week Ahead for FX, Bonds: All Eyes on Fed Rate Decision

The week starting September 14 puts the U.S. Federal Reserve at the center of FX and bond markets, with a rate hike considered possible after solid jobs and inflation figures. The Fed will announce its decision on Wednesday and could raise rates by 25 basis points, with money markets pricing an 82.5% probability for next week’s hike (up from about 68% before the inflation release), according to LSEG data. The focus will also be on Treasury yields after recent multi-year highs tied to higher Brent crude above $100 and renewed rate-hike expectations. The U.S. calendar includes retail sales (August), jobless claims, housing starts, industrial production, plus auctions of $13 billion in 20-year bonds and $19 billion in 10-year TIPS. Other central-bank watchpoints include the U.K. rate decision, Japan’s expected hike, and Taiwan and Canada data, alongside China and India releases.