Closing Bell: The Big Tech Playbook, Is a Rate Hike Inevitable? 9/11/26

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Scott Wapner (0:57)

Brian, thanks so much. Welcome to Closing Bell. I'm Scott Wapner, live from Post 9 here at the New York Stock Exchange. This Make or Break Hour begins with rates to Fed and stocks and whether an interest rate hike is, in fact, in the cards next week. We'll ask our experts over this final stretch what all of that would mean for the markets and your money. In the meantime, we'll show you the scorecard with 60 to go in regulation today. We have been green for all of this day, despite parts of the CPI that were hotter. Oil moving lower. That's been really the guiding trade partly today. Oil moves down. We get a little bit of relief. Stocks are green. All eyes, no doubt. On next week's Fed meeting, though, and what's starting to feel like a foregone conclusion, at least feels like that's how the market seems to be gaming out this coming Fed decision. For more on that, let's welcome in our CNBC Senior Economics Reporter, Steve Leesman.

Is this going to happen?

Steve Liesman (1:46)

I think so. I think there's a bunch of reasons why. I thought that actually before this number this morning, Scott, I think that the, and it's not just a single number that's going to lead him to it. It's a series of inflationary numbers, and you have these surging oil prices. I think it's also important, Scott, to remember where the market is priced here. The market is priced for this rate cut, and we have a Fed chair who has said he's taken lots of signal from the market. So the market's telling him what to do, and I think he's going to listen to that, and you also have these elevated inflation expectations. They're not higher, but the New York Fed, we reported it earlier this week. They're still north of 3 percent. They've been stuck there, and the Fed can't be happy with any of this.

Scott Wapner (2:25)

I tell you what, the great irony is going to be, Steve, if they do hike and rates at the long end actually come down, given what the Treasury's been trying to do and the fact that the roof of the White House may shake a little bit if they, in fact, do hike rates.

Steve Liesman (2:45)

You know, Scott, I will say the silence from the White House, at least today, is kind of deafening, it's very interesting. Obviously, earlier this week, we were reporting about the pressure that was coming from the administration, the vice president, the president, even the Treasury secretary, though less so, got involved in trying to urge the Fed either to hold or to cut. So, those are elements that are out there. We'll wait to see if over the weekend the president has something to say.

But I think that the Fed chair may have the leeway here to hike rates and it's interesting because what's happening now with yields is only one element of inflation. Obviously, they're married very much so to oil prices and unfortunately, and this is a reason why the Fed probably will hike, is it's hard to see any prospect militarily right now for oil prices to come down. It just seems to be getting worse and you don't even hear from the White House this comment that kept being made which is we'll have a deal tomorrow. That's not even there. So, if you're the Fed and you're trying to figure out are these high oil prices one off, they don't seem one off. Neither do the tariffs, Scott. We have new tariffs against Canada. We have a whole new set of tariffs that have been put in place. So, it's hard for the Fed to say these are one off when they seem to be fairly consistent.

Scott Wapner (4:00)

Well, that's my next question in terms of the one off, whether it's one and done, because theoretically you go next week, then you're not going to go in October, are you, right before the midterms. But maybe one and done is all that this would be intended to do, not so much for inflation's sake, but credibility's.