Mounting inflation pressures put more Fed rate hikes in view

Mounting inflation pressures and a strengthening economy look to be pushing the Federal Reserve towards an interest-rate hike on the eve of critical national elections, with traders on Wednesday piling into bets on a second straight Fed rate increase in late October. A closely watched measure of U.S. business activity, S&P Global's flash U.S. Composite PMI Output Index, jumped this month to its highest level since July 2021, S&P Global reported on Wednesday. The survey's measure of prices paid by businesses for inputs jumped to a nearly four-year high. Oil prices took a leg up on Wednesday, with Brent crude futures rising about 2 percent to $101.09 a barrel, and diesel fuel prices have surged to over $6.50 a gallon, as the US-Iran war continues to disrupt supply. Diesel has particular potential to broaden price pressures, as it powers the equipment and trucks used to make and move goods throughout the economy. The backdrop of rising inflationary risks and a strong economy means the Fed is likely to deliver more rate hikes, Fed Governor Michael Barr said on Wednesday in what's become a r