CPI Gets the Last Gate | Diesel Breaks $6 | The Ten-Year Holds Near Five | The Print Oil Already Crowded

Friday opens with a small relief bid and a large price test.

Dow futures rose about 299 points. S&P 500 futures and Nasdaq-100 futures each gained about 0.6% as oil backed off and Oracle (ORCL) rose after earnings. The calm follows four down sessions, not a clean reset.

The hard base is still there.

The 10-year yield sits near 4.94% after touching 4.95%. The 30-year is above 5.30%. Treasury’s $6 billion buyback plan has not capped the long end. Brent pulled back to $103.76 and WTI fell to $99.08, but both are still up about 8% on the week.

PPI already closed the first gate. CPI opens the last one.

Prediction markets moved into the print with September still live. A 25 basis point hike sits at 61%. No change sits at 39%. The August inflation book puts 3.4% at 48%, 3.3% at 28%, and 3.5% at 17%.

Traditional markets are trading the oil pullback. Prediction markets are still pricing the Fed risk. This is where prediction markets offer a lens traditional indicators do not.

CPI now has to do more than meet its forecast.

PPI rose 0.4% in August and 5.4% from a year earlier. That was up from 4.8% in July and kept the pipeline hot before the consumer print.

That matters because the labor side is no longer the hold case.

Payrolls rose 162,000 in August. Unemployment held at 4.1%. Participation rose to 61.6%. Warsh got the labor evidence he wanted. Waller now needs inflation to cool enough to defend patience.

The CPI book says the market expects a narrow answer. Headline inflation at 3.4% carries 48%. A 3.3% print sits at 28%. A 3.5% print sits at 17%. The core CPI book is even tighter. A 2.4% reading carries 49%. A 2.3% reading sits at 33%. A 2.5% reading is 16%.

A normal forecast miss may not be normal today.

A tenth can move the meeting because the meeting is already close.

The Last Price Gate

PPI made the hold case heavier. CPI decides whether Waller can still carry it.

The long end is pricing a second test before CPI lands.

The 10-year yield is close to 5%. That line was a stress marker yesterday. It is now the front rung. Polymarket puts a 5.0% touch before 2027 at 89%. A 5.1% touch sits at 76%. A 5.2% touch sits at 28%. A 5.5% touch is 9%.

That ladder is not only about the Fed.

It is about the price of lending through oil shocks, deficits, issuance and term premium. Treasury raised buybacks, but buyers still asked for more yield.

Mortgages show the same path into the household. The 30-year mortgage rate hitting 7.00% this year now sits at 72%. A move down to 6.50% sits at 50%.

The Fed can hike once. A household borrows for decades.

The Yield That Ignores Help

Treasury can buy bonds. It cannot make long money cheap by decree.

Oil cooled overnight, but diesel did not.

WTI moved back under $100 before CPI. Brent eased too. That helped futures. It did not reverse the week. Oil was still set for a gain of more than 7% as Iran-war disruption and refinery pressure pushed U.S. diesel above $6 a gallon for the first time.

Diesel is not a screen price for traders only.

It moves trucks, trains, ships and farm equipment. A higher diesel bill enters food, freight and goods before the household sees it.

That connects back to credit.

July consumer credit rose 4.2%, but revolving credit slowed to 2.5%. Small firms said sales weakened while price increases continued. Less card growth and weaker sales meet the same fuel bill.

The Fuel Under the Print

A CPI headline can cool for a month. Diesel can keep the invoice hot.

Prediction markets are useful today because they split the same event into parts.

The CPI book prices the number. The Fed book prices the consequence. The yield book prices the path after the consequence.

That is why the same morning can carry three signals.

A 3.4% inflation print is the most likely CPI outcome. A September hike is still the most likely Fed outcome. A 5% 10-year touch is priced at 89%. None of those contracts says the others must happen. They show where risk is stacked.

The same lesson applies to crypto policy.

Coinbase (COIN) says clearer rules can come through the Clarity Act or agency rulemaking. Polymarket puts the Clarity Act signed in 2026 at 19%, while some reports claim the September 15 Senate vote faces pressure from both crypto firms and banks.

The product can advance before the law does.

Connecticut shows the other side. It ordered nine prediction-market firms to stop sports contracts. The Senate book remains tight, with Democrats at 53% and Republicans at 49%. Politics trades as information. Sports still fights the gambling line.

The Split Contract

Markets price outcomes. Regulators still decide which outcomes are allowed to trade.

Friday begins where Thursday ended.

PPI failed to free the Fed. Oil pulled back but stayed high. Diesel broke $6. The 10-year stayed near 5%. CPI now has to carry the hold case by itself.

What is priced: a 61% September hike, headline CPI near 3.4%, core CPI near 2.4%, and the 10-year touching 5% before year-end.

What is not priced: diesel feeding freight for more than a month, mortgage rates holding near 7%, a core CPI miss moving September again, or state regulators turning sports contracts into a national fight.

PPI closed the first gate.

CPI owns the last one.

Capital moves early. Coverage catches up. The gap between the two is worth watching.