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Traders now see Fed raising rates by September

BY Reuters | ECONOMIC | 02:31 PM EDT

June 17 (Reuters) - Short-term U.S. interest-rate futures are now pricing in a bigger chance that the Federal Reserve will deliver a rate hike by September than opt to keep rates where they are.?

The shift in market-based rate-path expectations comes after the Fed said it would leave the policy rate in its current 3.50%-3.75% range at this time, but a near-majority of policymakers penciled a rate hike by the end of 2026 to combat higher inflation.?

(Reporting by Ann Saphir; Editing by Nia Williams)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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