September’s consumer price index report showed an 8.2% year-over-year increase in inflation, beating market estimates. This has aggravated concerns among investors and businesses about the possibility of a fourth consecutive 75-bps interest rate hike next month.
Legendary investor Mark Mobius foresees “interest rates in America going to 9% simply because if inflation is 8%, the playbook says you've got to raise rates higher than inflation." The Fed’s unrelenting hawkish stance has raised the odds of the economy sliding into a recession and kept the market on edge. The CBOE Volatility Index has climbed more than 82% year-to-date.
