Recent Fed communications following the September 16 decision to raise the federal funds target range by 25 basis points to 3.75-4.00% have positioned a further 25-basis-point increase at the October 28 meeting as the leading outcome, with Polymarket traders assigning it a 55.5% implied probability. Persistent inflation, including the August CPI rise of 0.4% month-over-month and 3.4% year-over-year alongside core measures at 2.4%, combined with solid August payroll gains of 162,000 and a stable 4.1% unemployment rate, support expectations for additional tightening to return price pressures to target. The narrow gap with the 43.5% probability of no change reflects uncertainty over incoming data releases before the statement-only meeting, while markets price only minimal odds for larger moves or cuts.

Sep 20 2026

Market pricing shifts sharply toward 25 bps increase ahead of October FOMC meeting

25 bps increase surges to 56%18%

Following the September FOMC meeting and updated projections, market prices for a 25 basis point increase in October surged from 38% to 56%, while the no change option dropped from 63% to 44%, reflecting growing consensus on a moderate rate hike at the October meeting.

Sep 17 2026

Markets react to Fed's hawkish September rate hike

25 bps increase surges to 53%15%

Following the September rate hike, markets adjusted expectations, with the probability of a 25 bps increase in October rising sharply, reflecting confidence in continued Fed tightening to combat inflation.

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