Finance

Following the latest consumer price index data, which revealed core inflation coming in slightly stronger than forecasted, traders drastically boosted the probability of an upcoming interest rate hike. Market pricing now reflects an 86% to 87% chance that the Federal Reserve will raise benchmark lending rates by a quarter percentage point at its next meeting. The resilient economic metrics and persistent underlying price pressures continue to encourage a tighter restrictive policy path.

The benchmark 10-year U.S. Treasury yield advanced significantly over the week, finishing close to the 5% threshold at 4.96%. Long-term sovereign debt yields remain elevated as continuous concerns over fiscal deficits, government bond supply, and persistent inflation pressures keep fixed-income investors on edge. Concurrently, the 2-year note closed out at 4.63%, tracking aggressive central bank policy expectations.

Digital assets experienced a broad pullback, with Bitcoin dipping below $77,000 to trade near a two-week low before the major inflation reports. Altcoins felt a heavier risk-off impact, causing Ethereum to slide toward $2,437, while Solana fell back under $100. Because cryptocurrencies do not yield interest, the escalating expectations of higher-for-longer borrowing costs continue to serve as a strong performance headwind.