Finance

Financial markets have heavily priced in a 25 basis point interest rate hike at the upcoming Federal Reserve policy meeting. Following the August inflation prints and recent energy cost pressures, implied probabilities for a rate increase shot up to roughly 86% to 90%. Economists note that while headline inflation matched forecasts at 3.4%, the persistent core metrics leave policymakers with little choice but to tighten monetary policy further.

The yield on the benchmark 10-year US Treasury note fluctuated near 4.92%, holding close to multi-year peaks as fixed-income markets adjusted to macroeconomic policy shifts. The Treasury Department conducted an expanded bond buyback operation, purchasing $5.2 billion in longer-term debt, which fell short of its maximum $6 billion cap. This lower-than-anticipated intervention volume added marginal upward pressure on long-dated yields, keeping borrowing costs elevated.

Cryptocurrencies faced a broad downturn as rising interest rate expectations dampened investor appetite for non-yielding risk assets. Bitcoin slid below the $77,000 threshold, representing a multi-week low, while Ethereum hovered around $2,440. Higher Treasury yields and macro headwinds have overall kept the broader digital asset market in a defensive posture.