Finance

Geopolitical tensions stemming from the multi-month war between the United States and Iran continue to disrupt energy channels, notably near the Strait of Hormuz. Consequently, West Texas Intermediate crude broke past $102 a barrel and Brent futures surged above $107, elevating fear that consumer price pressures will persist.

Amid accelerating wholesale price data for August and fears of prolonged high inflation, bond prices fell across the board. The yield on the benchmark 10-year U.S. Treasury note advanced to 4.95%, hitting its highest mark since October 2023 and placing a symbolic 5% barrier well within sight.

Financial markets are increasingly adjusting to a tightening monetary policy outlook ahead of next week's policy meeting. Following the latest Producer Price Index figures, federal funds futures indicate that the probability of the central bank raising its benchmark rate by 25 basis points has climbed to roughly 70-71%.