【The Fed’s September rate hike odds jump to 87%, the highest in three years 📉】
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The September 15 policy meeting hasn’t even started yet, but the market has already written the answer. Interest rate futures show that the probability of a 25-basis-point rate hike in September has risen to 87%. The day before, the figure was only 72%—and in a single day it jumped 15 percentage points. The meeting will take place over two days, September 15 to 16, and the result hasn’t been released yet. Bitcoin is hovering around $77,000; it has attempted to surge twice, but failed to hold steady.
First, let’s clarify one thing: this isn’t a delayed rate cut—it’s turning back upward to add hikes. The Fed’s current target interest rate range is 3.50% to 3.75%. The last time it raised rates was three years ago. The driving force is still inflation. In August, CPI came in at 3.4%. Core CPI is also at 2.4%, still far from the 2% target. Previously, out of 48 economists, only 13 expected rates to rise. Now almost everyone has changed their mind. Most people assumed that with inflation cooling and the election coming up, the Fed would stay put.
What’s really worth watching isn’t this single decision—it’s the path afterward. Traders are now betting that from now through June 2027, there will be at least three more hikes. The more aggressive baseline scenario is even harsher: by before July next year, rates would be fully hiked four times. And earlier this year, the market was betting on four cuts in the same period. Going from one side to the other, that’s an eight-count difference. Former Vice Chair Clarida also said that if they truly do hike next week, it won’t be just one hike afterward.
For crypto, interest rates are the hardest rope tied to all assets. Rate hikes mean higher Treasury yields and money is more willing to stay in “safe” places. Highly volatile assets like Bitcoin and Ethereum are often the first to see leveraged positions pulled away. After the August CPI data was released, both actually managed a small uptick. That suggests the market hasn’t fully priced the rate hikes in yet. As a result, long positions could end up becoming even more crowded.
Do you think next week’s rate hike will be the last straw that breaks the rebound, or will it be just bad news once the “shoe drops” and then everything is finally exhausted? Let’s discuss in the comments.
Join the X-Mr. fan group chat on the homepage 🔥
The September 15 policy meeting hasn’t even started yet, but the market has already written the answer. Interest rate futures show that the probability of a 25-basis-point rate hike in September has risen to 87%. The day before, the figure was only 72%—and in a single day it jumped 15 percentage points. The meeting will take place over two days, September 15 to 16, and the result hasn’t been released yet. Bitcoin is hovering around $77,000; it has attempted to surge twice, but failed to hold steady.
First, let’s clarify one thing: this isn’t a delayed rate cut—it’s turning back upward to add hikes. The Fed’s current target interest rate range is 3.50% to 3.75%. The last time it raised rates was three years ago. The driving force is still inflation. In August, CPI came in at 3.4%. Core CPI is also at 2.4%, still far from the 2% target. Previously, out of 48 economists, only 13 expected rates to rise. Now almost everyone has changed their mind. Most people assumed that with inflation cooling and the election coming up, the Fed would stay put.
What’s really worth watching isn’t this single decision—it’s the path afterward. Traders are now betting that from now through June 2027, there will be at least three more hikes. The more aggressive baseline scenario is even harsher: by before July next year, rates would be fully hiked four times. And earlier this year, the market was betting on four cuts in the same period. Going from one side to the other, that’s an eight-count difference. Former Vice Chair Clarida also said that if they truly do hike next week, it won’t be just one hike afterward.
For crypto, interest rates are the hardest rope tied to all assets. Rate hikes mean higher Treasury yields and money is more willing to stay in “safe” places. Highly volatile assets like Bitcoin and Ethereum are often the first to see leveraged positions pulled away. After the August CPI data was released, both actually managed a small uptick. That suggests the market hasn’t fully priced the rate hikes in yet. As a result, long positions could end up becoming even more crowded.
Do you think next week’s rate hike will be the last straw that breaks the rebound, or will it be just bad news once the “shoe drops” and then everything is finally exhausted? Let’s discuss in the comments.
