Forex
US Stocks Fall as Iran Tensions Fuel Hawkish Rate Hopes
US stock index futures declined on Monday after the US and Iran resumed military attacks, pushing oil prices higher and exacerbating inflation concerns. The interest-rate outlook has turned more hawkish, with traders anticipating a nearly 60% chance of a rate hike at the Federal Reserve's upcoming meeting in September.
This increase from 41.4% a week ago follows comments from Fed Chair Kevin Warsh, who suggested policymakers may need to raise rates if inflation doesn't ease to the central bank's 2% target.
David Chao, global market strategist at Invesco, noted that 'Chair Warsh delivered a distinctly more hawkish message than investors anticipated, making it abundantly clear that policy easing is not on the horizon.'