Fed Rate Hike Expectations Soar to 93% Amid Bond Market Sell-Off

The Federal Reserve's upcoming monetary policy meeting has significant implications for the bond market. Traders widely expect the Fed to raise its benchmark interest rate on Wednesday, with a 93% chance of a hike according to CME FedWatch.

This expectation is driven by recent inflation data, which showed that consumer prices remained sticky in August. If the Fed surprises markets by holding rates steady, it could accelerate the bond market sell-off and push up yields even further.

The 10-year Treasury yield has already risen to its highest level since 2007, reaching nearly 5% and putting pressure on consumers and businesses.