Market expectations for a Federal Reserve rate hike next month increased after fresh U.S. government data showed the Fed’s closely watched inflation gauge rose 3.7% year-on-year in July, slightly above economists’ expectations. Interest rate futures priced the probability of a September rate hike at about 42% after the data release, up from roughly 36% beforehand. The shift signaled a modest tightening in market expectations following the stronger-than-expected inflation reading.