Rate-Hike Odds Near 60% for Sept. 16 as Yields Squeeze REITs and Miners

Expensive oil feeds inflation, and inflation is feeding a more hawkish Federal Reserve. CME FedWatch put the odds of a September rate hike near 60% on Wednesday, up from roughly 40% before Chair Kevin Warsh's Jackson Hole speech. The 10-year Treasury yield rose to about 4.78%, its highest level since early 2025. A stronger-than-expected August payrolls report, which showed 162,000 jobs added against a 55,000 consensus, hardened the hawkish case ahead of the Sept. 16 policy meeting.

Higher yields act as a direct tax on real estate, making bonds more competitive with property income while raising borrowing and refinancing costs. The pressure extends to gold, which pays no interest and becomes less attractive relative to interest-bearing assets when rate expectations climb. A stronger dollar adds a second headwind, and mining shares tend to amplify bullion moves because profits depend on the spread between metal prices and production costs.

Equities have been absorbing both channels at once. The Dow tumbled 628.18 points, or 1.18%, to 52,786.07 on Wednesday, while the S&P 500 fell 0.58% to 7,673.52 and the Nasdaq Composite slipped 0.32% to 26,421.41. Investors now turn to this week's inflation reports, with the Treasury Department separately announcing plans to repurchase as much as $6 billion in bonds maturing between 10 and 20 years.