Philly Fed's Paulson: underlying inflation 'stubbornly elevated'; jobless claims beat, 10-year hits 5.17% (highest since 2007), Oct hike odds 64-75%
What happened
On Thursday, Sept. 24, 2026, Philadelphia Fed President Anna Paulson (an FOMC voter) said inflation 'remains stubbornly elevated' and that 'some modest further tightening may be warranted' if conditions evolve as expected, calling the return to 2% inflation 'a top priority.' The same day, the Labor Department reported initial jobless claims of 197,000 for the week ended Sept. 19 — below the 201,000 consensus forecast and near 57-year lows. The 10-year Treasury yield closed at 5.163–5.18% on Sept. 24, its highest since 2007, while the 30-year hit its highest since 2004. Markets priced roughly a 70–73% probability of a 25-bp hike at the Oct. 27–28 FOMC meeting, within the headline's 64–75% range.
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Start your free 14-day trialWho’s affected
- Rate-sensitive equities broadly — tech/growth stocks under pressure as higher discount rates compress valuations (with the 10-year at 5%+ 'new normal' levels); banks potentially supported by wider net interest margins; bond-heavy/dividend sectors (utilities, REITs) pressured by rising yields; energy stocks supported by elevated oil prices feeding the inflation story; mortgage/housing-linked stocks as higher yields flow through to borrowing costs.