Markets priced an 87% probability of a quarter-point Federal Reserve rate hike at the September 2026 FOMC meeting after the August CPI release, up from 72% a day earlier. The repricing followed a 0.4% rise in U.S. CPI in August and a 3.4% increase over the 12 months through August, according to PriceVia.
The jump is notable because it puts market pricing closer to J.P. Morgan Wealth Management's revised forecast for a September quarter-point increase while challenging Goldman Sachs' expectation that the Fed would hold rates. Market-implied odds are a measure of investor pricing, not a decision by policymakers.
Data Snapshot
| Metric | Current | Previous | Change | Period | As of | Source |
|---|---|---|---|---|---|---|
| Fed September rate-hike probability | 87% | 72% | up from 72% a day earlier | September 2026 FOMC meeting | 2026-09-11 | PriceVia |
| Monthly CPI | 0.4% | — | — | August 2026 | 2026-09-11 | PriceVia |
| Annual CPI | 3.4% | — | — | 12 months through August 2026 | 2026-09-11 | PriceVia |
| Core monthly CPI | 0.3% | — | — | August 2026 | 2026-09-11 | PriceVia |
| 10-year Treasury yield | 4.9915% | — | — | Intraday high | 2026-09-11 | PriceVia |
| J.P. Morgan September policy call | 25-basis-point rate hike | no rate changes in 2026 | changed outlook | September 2026 FOMC meeting | 2026-08-05 | J.P. Morgan Wealth Management |
August CPI and hike odds
August headline CPI rose 0.4% month over month and core prices increased 0.3%, while markets raised the implied probability of a quarter-point hike at the September 2026 FOMC meeting from 72% to 87%, PriceVia reported.
The 87% measure reflects investor pricing for that specific policy action, not the inflation readings or the votes of individual Fed officials; the one-day increase indicates that traders reassessed the likely policy response after the release.
J.P. Morgan's September call
J.P. Morgan Wealth Management strategists had already changed their outlook on August 5, calling for a 25-basis-point rate hike at the September 2026 meeting. Their earlier base case had been for no rate changes in 2026, according to J.P. Morgan Wealth Management.
That earlier shift means the firm was positioned for a September increase before the August CPI release pushed market-implied probabilities higher. The subsequent pricing move strengthened the alignment between its policy call and market expectations, without confirming the eventual outcome.
Goldman's hold call
Goldman Sachs chief economist Jan Hatzius was still expecting the Federal Reserve to hold rates in September as of August 31. His view was conditional: a hike would require upside surprises in August CPI and PPI, InvestingLive reported.
The CPI release was followed by the rise in implied hike odds to 87%, but the supplied data do not state whether Goldman Sachs changed its forecast after the report or provide August PPI results. The Fed's next concrete decision window is its September 15–16, 2026 meeting, as listed on the Federal Reserve's calendar.
In bond markets, the 10-year Treasury yield reached an intraday high of 4.9915% on September 11, with PriceVia describing the yield as near 5%. That reading accompanied the inflation-driven repricing ahead of the FOMC meeting.
