International Forex News - September 9

Bessent: Government May Accelerate Deficit-Reduction Plan If Democrats Win the Midterm Elections

On September 9, US Treasury Secretary Scott Bessent said that if the Democratic Party regains control of either chamber of Congress in the November midterm elections, the Trump administration will seek to push Congress to approve a plan to reduce the federal budget deficit before the end of this year. Bessent said he is working with Russell Vought, director of the Office of Management and Budget, to develop a fiscal-consolidation plan that could reduce the US federal budget deficit.
Bessent said that if Democrats win the midterm elections, "we will have to accelerate the plan during the lame-duck period rather than have the luxury of arranging the timing." The "lame-duck period" refers to the roughly two-month period between the November 3 election and the inauguration of the new Congress on January 3, 2027.

Probability of a Federal Reserve Rate Increase in September at 59.4%

According to CME FedWatch, the probability that the Federal Reserve will keep interest rates unchanged through September is 40.6%, while the probability of a cumulative 25-basis-point rate increase is 59.4%. By October, the probability of unchanged rates is 29.8%, the probability of a cumulative 25-basis-point increase is 54.4%, and the probability of a cumulative 50-basis-point increase is 15.8%.