US core inflation surprised above expectations, lifting Fed swaps. Market
pricing now shows a 90% probability of a Fed hike next week and two hikes fully
priced for this year. Schroders global head of economics David Rees said the Fed
is behind the curve; it can hike next week to permit an orderly rise in US
short-term borrowing costs, or hold and risk an uncontrolled rise in long-term
borrowing costs.
