Persistent inflation above the Fed’s 2% target, alongside resilient GDP growth near 3% in Q3 and a stable labor market with unemployment around 4.1%, drove the September 25-basis-point hike to the 3.75-4.00% federal funds range. The October pause reflected a data-dependent stance amid two dissents favoring immediate tightening, with officials citing the need for more information before the December meeting. Market-implied odds near 96% for hike-pause-hike align with futures pricing an 80-85% chance of a December increase and recent comments from Governor Waller supporting at least a 25-basis-point move. A sharper-than-expected cooling in November CPI or PCE data, or notable labor market softening, could shift the December decision toward another pause.