US RATE FUTURES-75 bps Fed hike seen by year-end

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NEW YORK, June 10 (Reuters) - U.S. interest rate futures fell sharply on Tuesday, extending Monday's sell-off, as further hawkish remarks from Federal Reserve officials fanned speculation about monetary policy tightening in coming months.

Federal funds futures FFF9 suggested traders are fully pricing in the Fed lifting its fed funds target rate by half a percentage point by October and a total of three quarters of a point by year-end.

On Tuesday, Dallas Fed President Richard Fisher said he would pay the price of weaker growth if that kept inflation in check.

Fisher's comments followed remarks from Fed Chairman Ben Bernanke who said late Monday "The latest round of increases in energy prices has added to the upside risks to inflation and inflation expectations." For more see [ID:nN09303720].

U.S. crude futures CLc1 were up $2 above $136 a barrel early Tuesday, less than $3 below the record high of $139.12 set on Friday.

On Tuesday, the Bank of Canada jumped on the inflation bandwagon, surprising the market by keeping key overnight rate unchanged at 3 percent in a bid to curb inflation. [ID:nBAC000230].

The Fed's current target rate on the borrowing of surplus reserves between banks is 2.00 percent. (Reporting by Richard Leong; Editing by James Dalgleish)