MarketPR
The CME Group's FedWatch Tool assigned a 34.7% probability on October 11 that the Federal Open Market Committee will raise the federal funds target rate by 100 to 175 basis points by the September 2027 meeting.
The current target rate stands at 3.75%-4.00%. This projection follows the Federal Reserve's first rate hike under Chair Kevin Warsh, which began a new cycle in September.
The primary driver for this outlook is inflation linked to President Donald Trump's policies, often referred to as Trumpflation.
Research published on Liberty Street Economics by economists at the New York Federal Reserve indicates that tariffs contributed 2.9 percentage points to goods price inflation by February 2026.
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