S&P 500 Falls 1.2% as Fed Signals October Rate Hike Over Iran War Inflation
Updated
Updated · Bloomberg · Jun 17
S&P 500 Falls 1.2% as Fed Signals October Rate Hike Over Iran War Inflation
3 articles · Updated · Bloomberg · Jun 17
Summary
Money markets fully priced in a Fed rate increase by October after Chair Kevin Warsh said price stability would guide policy while officials assess the Iran war’s inflation impact.
Two-year Treasury yields jumped 16 basis points to 4.21%, showing traders rapidly pushed up near-term rate expectations after the Fed’s signal.
The S&P 500 dropped 1.2% and the dollar advanced as higher-for-longer policy fears rippled across Wall Street.
The Fed had held rates steady earlier Wednesday, but Warsh’s first meeting reinforced a hawkish turn that investors now see leading to a later-2026 hike.