Markets price about 73% odds of October Fed hike after Barr remarks and hot PMI inflation

Governor Barr says further adjustments are likely in his base case; S&P Global flash composite PMI hits a multi-year high as two-year yields climb.

Confirmed By Sam Okonkwo · Staff Writer — Business United States Published Sep 23, 2026, 4:48 PM PT Updated Sep 23, 2026, 4:48 PM PT

Federal Reserve Governor Michael Barr said in Sept. 23 remarks that in his base case further policy adjustments are likely needed to bring inflation down to target after last week’s quarter-point hike, according to CNBC (opens in new tab) and The Hill (opens in new tab).

S&P Global’s flash U.S. composite PMI rose to 58.4, a 62-month high, with manufacturing and services also at multi-year peaks; the firm said overall inflation jumped to the highest since October 2022, CNBC (opens in new tab) reported. CME FedWatch odds of another hike at the Oct. 27–28 FOMC meeting rose to about 73%, per CNBC (opens in new tab).

The two-year Treasury yield climbed more than 13 basis points to about 4.9% as traders priced a tighter path, CNBC (opens in new tab) said. AFP (opens in new tab) separately noted stocks under pressure amid soaring bond yields and higher oil prices in the same session window.

The Event Log treats the ~73% figure as a futures-implied market probability, not a Fed decision. Barr’s comments are one governor’s base case, not a committee vote.