Israel-Hamas Conflict Creates Uncertainty Around Fed Rate Hikes

Fed funds futures traders see higher chance of no rate hikes in November and December due to Israel-Hamas conflict.

Conflict could lead to higher oil prices and resurgence of inflation, causing Fed to reconsider pausing rate hikes.

Market reactions show increased demand for Treasuries and safe-haven assets like gold.

Fed has underestimated inflation before, so could be wrong to pause rate hikes if conflict pushes up prices.

Situation has human impact and is a headwind for markets, especially if conflict spreads further.