Fed Rate Hike Chances Skyrocket as Core Inflation Surpasses Expectations

The Federal Reserve's chances of raising interest rates have increased significantly after core inflation rose more than expected in August.

According to the CME Group's FedWatch tool, the odds of a rate hike now stand at 91.6%, up from 72.4% just a day earlier.

The Bureau of Labor Statistics reported that core inflation climbed 0.3% last month, exceeding forecasts by 0.1 percentage points. The annual rate remained steady at 2.4%.

The ECB also raised its interest rates on Thursday, citing the ongoing war between the U.S. and Iran as a factor putting pressure on prices. The benchmark rate now stands at 2.5%, up from 2.25% previously.