Recent inflation readings, elevated by energy price spikes tied to geopolitical tensions, have shifted market-implied odds toward a possible 25-basis-point federal funds rate hike at the September 15–16 FOMC meeting, with CME FedWatch currently showing roughly even chances of action versus another hold at the prevailing 3.50–3.75% target range. The July 29 decision to pause drew three dissents favoring an immediate increase, underscoring internal divisions under Chair Kevin Warsh, while the June dot plot already reflected nine participants projecting at least one 2026 hike. Traders are now focusing on the next CPI release and labor data for signals on whether price pressures will persist or moderate enough to keep policy on hold through year-end.