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A sharp increase in energy prices has moved next week's Federal Reserve policy meeting into live territory, with investors now positioning for a rate rise.
Higher energy costs feed inflation expectations, and a material enough surge gives the central bank reason to act. Energy prices shift the rate calculus The jump in oil prices is what repriced investor expectations.
A Federal Reserve meeting that had not been widely flagged as an action point is now one. The energy price surge shifted that calculus quickly.
Investors are betting on a rate rise at the upcoming US central bank gathering, and they say the move in energy costs is sufficient to justify that position.
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