The US Federal Reserve left its policy interest rate unchanged at 3.75-4% following its latest meeting, in line with market expectations. Inflation data continues to shape the outlook for the central bank's next moves.
US annual inflation rose to 3.7% in September, up from 3.4% recorded in each of the two preceding months and above the market forecast of 3.6%. Energy prices were identified as the primary driver of the increase.
Producer prices climbed 6.3% year-on-year, marking the fastest pace of increase since December 2022 and significantly exceeding the expected 5.3%. Elevated oil prices are widely expected to maintain upward pressure on inflation in the months ahead.
With concerns over persistent price pressures intensifying, markets have begun pricing in an additional 25-basis-point rate hike for December. The Fed's next interest rate decision is anticipated on 18 December 2026.
