The probability of the Federal Reserve raising interest rates by 25 basis points reaches 92.5%, and Wall Street deduces three market scenarios According to BlockBeats, on September 16th, the Federal Reserve will announce its interest rate decision and summary of economic expectations at 2:00 am Beijing time on Thursday. Federal Reserve Chairman Kevin Warsh will hold a press conference half an hour later. According to federal funds futures, the probability of the Federal Reserve raising interest rates by 25 basis points is 92.5%, and the target interest rate range is expected to rise from 3.50% to 3.75% to 3.75% to 4.00%. If the interest rate hike is implemented, it will be Warsh's first interest rate hike since taking office in May this year. The core CPI in the United States rose by 0.3% month on month in August, while the situation in the Middle East pushed oil prices back above $100 per barrel. The market will focus on the resolution vote type and the new version of the dot matrix to determine whether the minority stance of only three officials supporting interest rate hikes in July has transformed into a broader policy consensus, and whether there will be another interest rate hike within the year. Compared to the 25 basis point adjustment this time, Warsh's statement on the subsequent interest rate path may be more crucial. Wall Street institutions mainly speculate three scenarios: if the Federal Reserve raises interest rates by 25 basis points and implies that it will only raise rates once or twice before ending, the US stock market may be able to digest this result, and the 10-year US Treasury yield may slightly fall; If the Federal Reserve remains inactive but hints at raising interest rates within the year, the initial rebound in the stock market may be difficult to sustain, long-term US bond yields may rise, the US dollar may weaken and drive the performance of gold and physical assets; If the dot matrix chart or post meeting statement implies that there will be three or more consecutive interest rate hikes, the 10-year US Treasury yield may significantly exceed 5%, and the US stock market may fall by more than 1%, the US dollar may strengthen. Warsh is facing dual pressure from the White House's demand to lower borrowing costs and rising bond market yields. The market is concerned about whether it can demonstrate that the Federal Reserve will address inflation while avoiding investors interpreting this action as the starting point of a new cycle of sustained interest rate hikes. [Original link]