Chance of fed-funds rate target at or above 5% by March jumps to almost 43% after September CPI

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Traders see a 42.6% likelihood that the fed-funds rate target will get to between 5% and 5.25%, or even higher, by next March after Thursday’s hotter-than-expected consumer-price index report for September. That’s up from 6.1% on Wednesday, according to the CME FedWatch Tool. The CPI report also cemented a 95.8% chance of a 75-basis-point rate increase in November, and resulted in a 61.3% chance of another hike of that size in December. Financial markets reacted to the report by driving all three major U.S. stock indexes lower Thursday morning, while pushing 6-month through 20-year Treasury yields further above 4%.

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