Is a September Rate Hike Now Off the Table? | Presented by CME Group

The video explains why the market-implied probability of a Federal Reserve rate hike in September has dropped from roughly 60% in late July to about 30%. Weak labor-market data and a 2.5% core CPI reading suggest inflation is concentrated in energy rather than broad-based, giving the Fed reason to hold rates steady. However, headline CPI remains at 3.4% and oil volatility means the inflation problem is not resolved. The next inflation reports will be key for the Fed's path back to 2%. - CME FedWatch showed September hike odds near 60% in late July. - The market now prices only about a 30% chance of a September hike. - The August 7 employment report showed clear labor-market weakness. - Headline CPI came in at 3.4% year-over-year. - Core CPI at 2.5% suggests inflation is energy-driven rather than broad-based. - The Fed has reason to stand pat in September, but inflation remains above target. - Oil volatility and upcoming inflation reports remain key uncertainty.