Federal Reserve Governor Michael Barr stated on Wednesday that policymakers may need to further adjust policy to ensure inflation returns to target in a timely manner. On the same day, S&P Global's flash manufacturing and services PMIs both hit their highest levels in over four years, with their overall inflation gauge also reaching its highest level since October 2022, primarily driven by rising fuel, transportation costs, and wages. The market reacted strongly to this news, with CME Group's FedWatch data showing the probability of a rate hike at the Federal Reserve's October 27-28 meeting jumping to 71%. Concurrently, the 2-year Treasury yield, which is most sensitive to Federal Reserve policy expectations, surged over 13 basis points to 4.9%.