THE ODDS OF A 50 PER CENT INCREASE IN SEPTEMBER BETS ON TRADERS, AND THE MARKET DEPENDS ON CPI DATA

THE PROBABILITY OF A 25 BASIS POINT INCREASE IN SEPTEMBER BETS BY TRADERS IS ABOUT 50 PER CENT. THE FED, UNDER THE LEADERSHIP OF FEDERAL RESERVE CHAIRMAN KEVIN WALSH, REDUCED FORWARD-LOOKING GUIDANCE AND THE MARKET RELIED ON HARD DATA TO DETERMINE POLICY PATHS. MODERATE CPI DATA IN JULY COULD WEAKEN THE CAUSE OF INTEREST RATE HIKES AND, IF EXPECTED, INCREASE THE SEPTEMBER RATE HIKE. THE 10-YEAR RATE OF RETURN ON UNITED STATES DEBT IS SET IN THE DIRECTION OF THE JULY MODERATE-DRIVEN CPI RATE OF RETURN. VOLATILITY IN INFLATION DATA DIRECTLY INFLUENCES THE SHARP SHOCK OF THE PROBABILITY OF INTEREST RATE HIKES, REFLECTING THE HIGH SENSITIVITY OF MARKETS TO POLICY PATHS. THIS DATA IS NOT ONLY THE EXPECTED WINDBENDER OF INTEREST RATES, BUT ALSO THE KEY VARIABLE DRIVING THE RESTRUCTURING OF THE UNITED STATES DEBT YIELD CURVE。