Market expectations for an interest rate hike in October have dropped to a new low of 17% following the release of September employment figures that missed forecasts. This probability represents a sharp decline from just a few days ago, when market participants estimated a near 75% chance of a rate increase.
The sudden shift from a 75% probability to 17% has triggered intense volatility across the bond market. This volatility reflects a rapid repricing of risk as the September jobs report pushed the odds of a hike to their current 17% low.