Fed to hike? When traders see a rate increase coming
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- Kalshi traders assign 64% odds that the next Fed rate hike occurs by July 2027 and a 43% chance it happens this year.
- Kevin Warsh is set to be sworn in as Fed chair on Friday, replacing Jerome Powell.
- U.S. Treasury yields rose to their highest level since 2007, prompting a reassessment of rate‑hike expectations.
- Ed Yardeni says the bond market may have more influence on monetary policy than the incoming chair.
- Chris Senyek notes that bond‑market pressure could push the Trump administration toward a quicker resolution of the Iran war, potentially easing inflation.
Why it matters: Borrowers face higher loan costs as a 64% chance of a Fed hike by July 2027 could push rates up; investors gain from higher yields, while the new chair's flexibility to cut rates shrinks.
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