After Waller's "Jackson Hole" Remarks, Is a September Fed Hike "Inevitable"?

Markets quickly priced in rate hike expectations. The two-year Treasury yield jumped 12 basis points to 4.35%, the largest single-day gain since the first press conference in June and the biggest move during Jackson Hole since 2010; the dollar strengthened, while gold pulled back. Federal funds futures showed the probability of a September rate hike rising above 50% from about 35% before the speech, with at least one hike this year almost fully priced in. Barclays and Societe Generale adjusted their forecasts on the day, expecting 25 basis point hikes in both September and December.