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Will the Fed Really Hike Rates?
 Take a look at Polymarket right now, and you’ll see that the odds of the Fed announcing a 25bps rate hike at its meeting next week have spiked to 79%.
This follows the release of August US inflation data, which showed CPI rising 3.4% YoY and 0.4% from July, with both figures matching expectations. Core CPI increased 2.4% annually, also in line with forecasts, but its monthly rise of 0.3% exceeded the 0.2% expected.
Not catastrophically overheated, but this comes against a backdrop of oil at around $100, while conflict in the Middle East looks like it could potentially drag on indefinitely, and bond yields rose still further after the inflation data came out, all of which also contributes to that growing expectation of a rate hike next week.
But… could the crowd be wrong on this one? Zoom out, and you can find that Core CPI is as low as it has been since March 2021, and in fact, SPX closed green yesterday, entirely reversing its earlier dip.  One possible reading here is that the market views current inflation as oil-and-war-related, and therefore transitory rather than structural, which potentially means the Fed doesn’t need to hike. After all, a rate increase isn’t going to produce more oil or open up the Strait of Hormuz.
Plus, keep in mind that Kevin Warsh was brought in by Trump, who makes no secret of the fact that he wants the Fed to bring rates down.
We’ll have to wait and see on this one, and the wisdom of prediction market crowds may prove correct again, but there is at least a coherent argument for leaving rates as they are.
New Clarity Act Draft
The Senate will vote next week on whether to move the Clarity Act forward, and while Senate Republicans have rolled out a fresh draft, ongoing disagreements mean the bill's future is still up in the air.
What’s new in the updated draft:
● Trading protocols that have a central entity controlling their operations will face a new CFTC registration requirement.
● The CFTC and the Treasury Department will team up to develop new registration guidelines.
● The bill’s DeFi rules have been scaled back to focus specifically on spot trading in digital commodities.
● The text adds clear guidelines on how credit unions can legally handle and custody crypto assets.
What didn’t change:
● Despite strong objections from Democrats regarding politicians' crypto interests–especially those of the Trump family–the ethics rules remain largely untouched.
● Proposed restrictions that block officials and their spouses from launching or sponsoring digital assets will still expire in January 2029.
● The Department of Justice remains the designated body in charge of enforcing ethics rules.
Senator Cynthia Lummis explained that Republicans incorporated more than 114 provisions requested by Democrats, but it’s reported that the latest draft still doesn’t have Democrat backing, meaning that it may be a challenge to get the bill through the Senate.
Nvidia to Invest $10B in Anthropic?
Anthropic is officially preparing for its public debut, targeting a $2 trillion valuation that would mark the largest IPO in history, and according to a Reuters report citing anonymous sources, Nvidia is in talks to anchor the listing with a $10 billion investment, although neither company has officially confirmed the discussions.  However, the numbers behind the potential deal are explosive, with Anthropic's annualized revenue run rate climbing past $65 billion this summer, while internal projections are modeling up to $200 billion in revenue by 2028.
The mega-listing is expected to land ahead of the US midterm elections in November, but for the Nvidia investment, we won't know the exact terms–if it’s confirmed–until Anthropic files its official IPO prospectus.
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