Tuesday’s August consumer-price index report, which showed “very stubborn” pressure remaining in the gauge which excludes food and energy, “is a game changer in terms of Fed expectations,” Jefferies economists Aneta Markowska and Thomas Simons said in a note. They said a 4% terminal fed funds rate, the level at which the Fed is seen as ending its rate-hike campaign, “won’t be high enough.” The economists said that the messaging from Fed policy makers “is likely to shift very quickly from a 4% terminal funds rate toward 4.5% and perhaps even higher.” After the CPI data, stocks fell sharply, with Dow industrials DJIA,
Source: Marketwatch
