Probability of higher Fed rate hike soars above 90% for March
Possibility of 50 basis points hike jumps to 94.7% from 46.3%
ANKARA
The probability of a higher rate hike by the US Federal Reserve during a meeting next month skyrocketed Thursday after US consumer inflation climbed to record levels.
The possibility of a 50 basis points hike soared to 92.8% at 4.30 p.m. EDT, according to the FedWatch Tool provided by US-based global markets company, Chicago Mercantile Exchange (CME) Group.
While the probability climbed further to 94.7% at 5 p.m. EDT, it stood at 46.3% at 9.30 a.m.
The Fed is expected to announce a rate increase after its two-day meeting on March 16.
The probability of an increase of 25 basis points fell to 7.2% from 53.7%, according to CME Group. It further declined to 5.3% at 5 p.m..
The sudden change came as US consumer prices in January soared to 7.5% year-on-year, marking the largest 12-month increase since February 1982, according to the Labor Department.
Investors are expecting the Fed to make faster and higher rate hikes this year to tame record inflation.
