Fed's June Rate Hike Likely as Inflation and Consumer Spending Rise

Markets are now pricing in a better than 50% chance of an interest rate hike next month after a new report from the Commerce Department showed that consumer inflation accelerated in April. Traders of futures contracts tied to the Federal Reserve policy rate are now betting the Fed will hike rates again to cool inflation. The Fed’s preferred measure of inflation – the consumption expenditures index, excluding volatile food and energy prices – rose 4.7% in April, accelerating from 4.6% in March.