ANKARA

The probability of the US Federal Reserve bumping up interest rates 75 basis points next month fell to 37% on Wednesday as consumer inflation slowed.

The probability of a 75 basis points rate hike stood at 68% on Tuesday before the release of the key inflation data, according to the FedWatch Tool provided by US-based global markets company Chicago Mercantile Exchange (CME) Group.

US consumer inflation annually rose 8.5% in July, easing from the 9.1% yearly gain in June, which was the highest year-on-year increase in more than 40 years, according to Labor Department figures released earlier Thursday.

The Fed has increased its benchmark interest rate by a total of 225 basis points since March: 25 points that month, 50 basis points in May, a surprise 75 points in June, and another 75 points in July.

The central bank's monetary tightening and aggressive rate hike cycle to tame record high inflation seems to be working, as consumer price increases slowed down in July.

This has caused investors to suspect that the Federal Open Market Committee (FOMC) could start to put on the brakes at the conclusion of its two-day meeting on Sept. 20-21.

It is now expected that the FOMC would less likely go for a 75 basis points hike on Sept. 21.

On Wednesday, the probability of a 50 basis points rate hike climbed to 63%, up from 32% on Tuesday.