Fed is Expected to Pause Rate Hikes
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Hotter September inflation, rising oil prices and a 10-year Treasury yield above 5% are complicating the Fed’s outlook.
Kevin Warsh faces pressure to explain a possible pause as US inflation rises, with markets watching for signals on future rate hikes.
The 12-month rate of inflation as of August 2026 is 3.7%, according to the Bureau of Labor Statistics (BLS). Energy inflation spiked to 20.4% as the status of the Strait of Hormuz remains uncertain. Core inflation, which excludes energy and food, was 2.6%.
The Bank of Canada raised its policy interest rate by 25 basis points to 2.5 per cent. It’s the first hike since July 2023. The central bank wants to control inflation by reducing the risk that high fuel prices could spill over and seep into the overall economy.
