Finance

Oil Holds Near 100, the 10 Year Nears 5 Percent, and Next Week Brings the Fed Call

By Omar aka Crypt0 · Sep 12, 2026

Markets head into next week's September 15 and 16 Federal Reserve meeting with energy prices and bond yields doing most of the talking. WTI crude surged past 100 dollars a barrel this week to multi month highs on the expanding conflict between the United States and Iran and the resulting oil supply squeeze, while Brent climbed beyond 106 dollars. Friday brought some profit taking, with both benchmarks easing about 3 percent and WTI sliding back below 100, but the International Energy Agency said prices at this level start to dent consumption.

Bond yields are telling a similar story. The 10 year Treasury yield touched 4.92 to 4.98 percent, its highest in about three years, and the 30 year yield hit its highest since June 2004 before settling at 5.309 percent after Friday's CPI data. The two year yield, which tracks Fed expectations most closely, climbed to 4.61 percent, its highest in more than two years. The move went global: the European Central Bank raised rates by 25 basis points to 2.5 percent on September 10. A Reuters poll found economists split, with 11 of 22 expecting the Fed to hold for the rest of 2026 and 10 seeing at least one hike, while futures markets have priced in two hikes by March.

Friday's August CPI report was the week's main event, and it came with a twist. Headline inflation held at 3.4 percent compared with a year earlier, exactly as forecast, but the hotter than expected 0.3 percent core reading traced back largely to one quirky category: a record 1.549 percent monthly jump in telephone services. Bank of America attributed it to AT&T retiring old unlimited plans and raising administrative fees, calling the effects temporary and likely to unwind in coming months. Goldman Sachs estimated wireless services added about 10 basis points to core. Beneath the quirk, the annual core rate cooled to 2.4 percent, its slowest pace since February 2021.

The rest of the data painted a mixed but strengthening picture. Employers added 162,000 jobs in August, roughly triple the 53,000 analysts had expected, which strengthened the case for a hike. University of Michigan consumer sentiment slipped to 47.8 in September from 51.7, while one year inflation expectations jumped to 4.6 percent from 4 percent, with survey director Joanne Hsu pointing to resurgent fuel prices and trade tensions. Treasury Secretary Scott Bessent defended the Treasury's strategy of buying back longer dated debt, arguing rising yields are a global phenomenon tied to oil prices. White House economic advisor Kevin Hassett said President Trump, who has pushed publicly for rate cuts, 'will have an opinion' on a Fed hike while respecting the central bank's independence.

Stocks took the news in stride. The S&P 500, Nasdaq, and Dow each rose more than 1 percent on Friday, and crypto related stocks bounced hard: Coinbase gained 4.4 percent, Circle added 3.3 percent, Strategy rose 4.3 percent, and Gemini climbed 6.2 percent. Traders now price about an 85 percent chance of a quarter point Fed move next week, and CoinDesk noted October hike odds jumped to 42 percent from 27 percent, shifting the debate from whether the Fed moves to how many moves this cycle ultimately brings.

For readers, the practical read is straightforward. Mortgage rates already touched 2026 peaks this week, and next Wednesday's decision sets the tone for borrowing costs into year end. Energy prices remain the wild card: if oil holds near triple digits, inflation stays sticky and the Fed stays hawkish; if it eases, the quirky phone bill print that pushed core higher could fade into a footnote. Watch Wednesday's announcement, then the October 28 meeting, for the next signal.

Sources

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