The probability of a Federal Reserve interest rate hike by the September 16 FOMC meeting has jumped to 82.4%, up from 52.4% just one week ago, according to the CME Group's FedWatch Tool. The sharp increase is driven by three factors: escalating U.S.-Iran military conflict reigniting energy price inflation, the spread of Trumpflation into core inflation measures, and artificial intelligence hardware demand pushing up GPU and memory prices. Core Personal Consumption Expenditures have barely declined, signaling that inflation is becoming entrenched beyond volatile food and energy costs. Higher petroleum-based product costs and transportation expenses are being passed on to consumers, while AI infrastructure pricing power is contributing to above-average inflation.
NVIDIA CorporationAI hardware demand is cited as pushing up GPU prices, benefiting NVIDIA's product demand.
CME Group Inc