Fed Rate-Hike Odds Rise After U.S.-Iran Tensions Escalate, Prediction Market Shows 36% Deal Chance

The probability of a Federal Reserve rate hike rose again after U.S.-Iran tensions escalated over the weekend, reviving concerns about energy-driven inflation and undermining the market assumption that the Fed would keep rates unchanged for the rest of this year. According to Jin10, prediction markets showed the probability of the United States and Iran reaching an agreement before year-end fell to 36%, suggesting a narrowing window for negotiations.