UPDATE: Markets now see a 38% chance the Fed raises rates this week

A rising implied probability of a near-term Fed rate hike (now 38%) signals a more restrictive policy path than previously priced. This typically tightens financial conditions, lifts front-end yields, and supports the US dollar while pressuring risk assets via higher discount rates and reduced liquidity expectations. Near-term volatility may increase across rates, FX, and equities as positioning adjusts into the decision.