Fed Rate Hike Looms as Inflation Fears Escalate

Goldman Sachs and J.P. Morgan have both revised their forecasts to predict a U.S. Federal Reserve rate hike this week. This change comes after stronger-than-expected inflation readings, which have raised concerns that progress toward the Fed's 2% inflation target may stall.

The latest data showed U.S. consumer and producer prices rose more than expected in August, while oil prices climbed above $100 a barrel due to renewed hostilities in the Middle East.

Goldman Sachs expects a 25-basis-point increase at the FOMC meeting on September 15-16, while J.P. Morgan forecasts quarter-point hikes in both September and December.