Recent hotter-than-expected October CPI data, with headline prices rising 0.4% month-over-month and core up 0.3%, both exceeding forecasts, has reinforced expectations for tighter policy amid inflation remaining well above the Fed’s 2% target. Strong labor market conditions, resilient economic growth, and geopolitical pressures on energy prices have further supported this view, as highlighted by Fed Governor Christopher Waller’s November 10 comments favoring at least a 25 basis point hike in December and potentially more if price pressures worsen. These factors align with the 84.5% market-implied probability for a 25 basis point increase at the December 8-9 FOMC meeting, where updated projections will also be released, while the low odds for no change or cuts reflect limited scope for easing given persistent inflation risks.