Will the Fed increase interest rates by 25 bps after the December 2026 meeting?

- [2026-09-16] The FOMC raised the federal funds target range by 25 bps to 3.75%–4.00% by a 12-0 vote, its first hike since 2023, citing elevated inflation. "The Federal Open Market Committee (FOMC, or the Committee) raised the federal funds target range by 0.25 percentage point to 3.75%–4.00%." https://www.wellsfargoadvisors.com/research-analysis/reports/fed-rate.htm - [2026-09-16] The updated Summary of Economic Projections lifted the median end-2026 fed funds rate to 4.1% from 3.8% in June, and "16 of 18 participants projected at least one more increase this year." https://coruzant.com/fintech/federal-reserve-decisions - [2026-10-06] FRED's official daily series confirms the current target range remains 3.75% (lower) to 4.00% (upper) as of the most recent observation, unchanged since the September hike. https://fred.stlouisfed.org/series/DFEDTARU - [2026-10-07] Minutes from the September 15-16 meeting were released, showing unanimous support for the hike; the minutes said "most participants" saw another increase as likely appropriate "by year end." https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-07] Minutes also revealed deep division over the future path, with weaker post-meeting data since dropping October hike odds; market expectations for another rate hike at the October 27–28 meeting have dropped below 22% after cooling consumer prices and slowing job creation. https://www.raisin.com/en-us/news/fomc-minutes-breakdown-rate-hike-division/ - [2026-10-08] Governor Christopher Waller gave a speech (part of pre-blackout commentary) ahead of the October meeting; Fed officials enter the blackout period from October 17 to October 29. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-09] As of this date, market pricing showed only about a 16%-18% chance of a second straight hike in October, with most traders expecting a hold at 3.75%-4.00%. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-09] The same source noted weak September payrolls have shifted the expected hike timing from October towards the December 9 meeting. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-09] Market odds of a hike occurring by December were estimated at roughly 75%-85% as of this date (per the table in the same article), though this reflects a broader "by December" framing rather than the December meeting specifically. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-08] A separate market-tracking summary (reporting on prediction-market pricing distinct from this contract) noted "For the December meeting, the hold is priced at 27%, significantly lower than October's prices, as new projections will be released." https://coruzant.com/fintech/federal-reserve-decisions - [2026-10-14 scheduled] September CPI release is the key data point ahead of the October 28 decision and will shape expectations heading into December. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-28 scheduled / 2026-12-08–09 scheduled] The October FOMC meeting (Oct 27-28) and the December meeting (Dec 8-9, with new economic projections/dot plot) remain the two intervening scheduled decisions before this question's December resolution date, per the Fed's official calendar. https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm BOTTOM LINE: As of October 10, 2026, the Fed's target range sits at 3.75%–4.00% following a September 25 bp hike, with officials' own dot plot pointing to one more 2026 hike; however, weakening labor data has pushed market-implied hike odds for the intervening October meeting down to roughly 16-18%, with expectations concentrating a potential next hike at the December 9 meeting rather than October, making a December hike a live but far-from-certain possibility pending the October 28 decision and incoming data (CPI Oct 14, jobs reports, etc.). NOT FOUND: No official FOMC statement or minutes yet exist for the October 27-28, 2026 meeting (it has not occurred as of this report), so it is unknown whether that meeting will hike, hold, or cut, which materially affects the starting point and policy momentum entering the December 8-9, 2026 meeting.

- [2026-09-16] At the September meeting, the FOMC voted 12-0 to raise the federal funds rate by 25bps to 3.75%–4.00%, its first hike in years, ending a prior cutting cycle; the Fed had cut three times in a row in late 2025. https://www.chase.com/personal/investments/learning-and-insights/article/federal-reserve-raises-rates-officials-signal-one-more-hike-in-2026 - [2026-09-16] The accompanying dot plot showed 16 of 19 (other reports say 12 of 18 participating) officials expecting at least one more 25bp hike by year-end 2026, with a median year-end projection of ~4.10%, i.e., one more quarter-point move than the just-delivered hike. The September Summary of Economic Projections' dot plot showed the median FOMC member expecting an additional 25 basis point rate hike in 2026. https://www.chase.com/personal/investments/learning-and-insights/article/federal-reserve-raises-rates-officials-signal-one-more-hike-in-2026 - [2026-09-30] A Forbes analysis reported fixed income markets are now firmly pricing in back-to-back Federal Reserve rate hikes for October and December 2026… This would elevate the federal funds rate to 4-4.25% , with December seen as "almost certain" if October is skipped. https://www.forbes.com/sites/simonmoore/2026/09/29/what-to-expect-from-interest-rates-for-the-rest-of-2026/ - [2026-10-02] After a weak September jobs report (+29,000 vs. ~80,000 expected) and a cooler core PCE print, CME's FedWatch tool, based on trading in 30-day interest rate futures, shows only a 17% chance that the Fed increases rates by a quarter percentage point. One week ago, odds were close to 36% , after the weak jobs data. https://www.cnbc.com/2026/10/02/fed-rate-hike-odds-decline-after-september-jobs-report.html - [2026-10-02] The same report noted while traders now think a hike in October is unlikely, they're still forecasting that the central bank will raise rates in December. On FedWatch, odds are above 75% for a hike in December, while on Kalshi there are 65% odds . https://www.cnbc.com/2026/10/02/fed-rate-hike-odds-decline-after-september-jobs-report.html - [2026-10-10] CME FedWatch currently shows an 81.6% probability that the US Federal Reserve will maintain interest rates in the upcoming meeting (October 28), consistent with markets pushing the expected hike to December instead. https://growbeansprout.com/tools/fedwatch - [2026-10-03] A prediction-market aggregator tracking Kalshi/Polymarket reported October hike odds near 17-18% but noted another hike before 2027? 72% Yes, Dec. 9 alone: 65%... Kalshi and Polymarket agree on a 2026 hike: 71.5% vs. 72.0% , suggesting cross-venue consensus that a hike this year (most likely in December) is the base case. https://defirate.com/prediction-markets/fed-decision-odds/ - [2026-09-23] This hiking episode is historically unusual: the Fed had gone The Fed's last movement occurred in December 2025 when the Fed lowered the target range of the fed funds rate to 3.50% to 3.75% , meaning the committee pivoted from cutting to hiking within one quarter — a reversal not seen in most prior cycles. https://www.bondsavvy.com/fixed-income-investments-blog/fed-dot-plot - [2025 (pre-period)] As outside-view context, academic/market research finds Fed and market rate-path forecasts are frequently wrong: the Fed's and the market's forecasts about the future path of the Fed funds rate are almost always wrong…the direction of the forecasting mistake is always identical, suggesting that the market is taking its cue about the future path of interest rates from the Fed's dot plot , meaning dot-plot and futures-implied paths tend to move together but both can be biased in the same direction when conditions shift. https://www.apolloacademy.com/the-forecasting-record-of-the-fed-and-the-market/ - [2026-04-17] More recent dot-plot accuracy work finds the dot plot's track record as a forecast is poor. Over the past decade, the median year-ahead dot has been within 50 basis points of the actual year-end federal funds rate only about half the time , underscoring that the Fed's own median projection (used here to justify "one more hike") is not a reliable guarantee. - [2026-01-28] On the other hand, a recent NBER working paper found that prediction-market pricing (Kalshi) on Fed decisions has been highly reliable: Kalshi's predictions are just as accurate as Wall Street's, and that it maintains an edge over Fed funds futures. The modal Kalshi forecast…has had a perfect track record from 2022 through June… the Kalshi median and mode have a perfect forecast record on the day before the FOMC meeting , suggesting markets close to meeting day (not the dot plot months out) are a stronger base-rate guide. - [2026-08-07 to 2026-10-02] Base-rate pattern this cycle: hike odds for any given meeting have swung sharply with each data release (e.g., September hike odds moved 33%→60%→66%→92% over weeks; October hike odds fell from ~64-70% to ~17-18% within one week after a weak jobs report), indicating high volatility and strong data-dependence of these meeting-specific odds rather than a stable trend. https://www.forbes.com/sites/digital-assets/2026/08/31/cme-fedwatch-provides-a-66-chance-fed-will-hike-rates-in-september/ ; https://www.cnbc.com/2026/10/02/fed-rate-hike-odds-decline-after-september-jobs-report.html BOTTOM LINE: The reference class here is a genuinely atypical event — a Fed hike resuming right after a cutting cycle, something rare in modern history — so there is no strong historical base rate for "hike after a hike-after-cuts episode"; the best available guide is near-term market pricing and the Fed's own SEP, both of which currently lean toward a December hike (CME FedWatch/Kalshi/Polymarket aggregator near 65-75%) even though October odds collapsed, and the one-more-hike dot-plot signal was explicit, but both dot-plot and futures-implied paths have historically had mixed/poor multi-month predictive accuracy and have swung sharply week-to-week this cycle. NOT FOUND: An authoritative long-run statistic on how often the Fed has hiked immediately after a hike delivered at the prior meeting (base rate for "consecutive hike" specifically); official Fed funds futures-implied probability figure for the December 2026 meeting as of the SEP/dot-plot release itself (only post-jobs-report CME figures ~75-77% were found, not a single definitive current CME percentage close to today's date beyond third-party aggregator reproductions).

YES means: the FOMC raises the fed funds target range by exactly 25 bps at its December 8-9, 2026 meeting (from whatever base range exists entering that meeting), with the move rounding into the "25 bps increase" bracket. - [2026-10-08] Fed Governor Christopher Waller, in a speech in Istanbul, said additional rate hikes would likely be necessary to curb rising inflation and bring it to the Fed's 2% target , and that hikes do not need to come at consecutive meetings , explicitly pointing to December as the likely next move if October is skipped. https://stocktwits.com/news-articles/markets/equity/two-more-fed-rate-hikes-likely-after-governor-waller-s-hawkish-remarks-goldman-sachs/cZD6eKGRBVe - [2026-10-08] Waller argued the case for tightening is strengthening because, in his words, economic activity is strengthening and he is "concerned that the recent acceleration in inflation" could unmoor inflation expectations — a direct hawkish signal from a sitting Governor just before the blackout period. https://stocktwits.com/news-articles/markets/equity/two-more-fed-rate-hikes-likely-after-governor-waller-s-hawkish-remarks-goldman-sachs/cZD6eKGRBVe - [2026-10-08] Goldman Sachs' Jan Hatzius reacted to Waller's remarks by saying Goldman Sachs still expects one additional 25 bps rate hike in December even while flagging upside risk to two hikes — i.e., Goldman's base case (not just a tail case) is a December 25 bp hike. https://stocktwits.com/news-articles/markets/equity/two-more-fed-rate-hikes-likely-after-governor-waller-s-hawkish-remarks-goldman-sachs/cZD6eKGRBVe - [2026-10-08] Per CME FedWatch data cited same day, the probability of a 25 bps rate hike in October is 17.7%, while the probability of a hike of up to 50 bps in December is 83.7% , showing the market overwhelmingly expects the "missed" September-dot-plot hike to land in December rather than evaporate entirely. https://stocktwits.com/news-articles/markets/equity/two-more-fed-rate-hikes-likely-after-governor-waller-s-hawkish-remarks-goldman-sachs/cZD6eKGRBVe - [2026-10-09] A brokerage survey found only 1 of 14 surveyed (BofA) expects an October hike, implying the remaining consensus pushes its expected hike into December rather than dropping the hike thesis altogether. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-09-16] The September Summary of Economic Projections' median end-2026 fed funds rate of 4.1% is structurally consistent with exactly one more 25 bp move after September's hike to 3.75–4.00%, i.e., the dot plot's arithmetic points precisely at a 25 bp December increase to 4.00–4.25%, not a larger move. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-08] Cleveland Fed's nowcast shows inflation reaccelerating into Q4: quarterly annualized core PCE is projected to rise to 3.05% in Q4 2026 from 2.29% in Q3, and headline CPI's Q4 annualized pace is projected at 4.12% versus 1.57% in Q3 — fresh data supporting the Fed's stated rationale for "one more hike." https://www.clevelandfed.org/indicators-and-data/inflation-nowcasting - [2026-10-10] University of Michigan survey data show consumer sentiment falling to 46.3 while twelve-month inflation expectations rose to 4.7% from 4.6% in September , a signal of de-anchoring expectations that Waller specifically cited as grounds for continued tightening. https://stockpil.com/us-dollar-consumer-sentiment-fed-rate-hikes - [2026-10-10] Multiple independent trackers converge on roughly 70-85% implied odds of a December hike as of October 9-10: FXStreet/CME near 85% ( traders widely expect the Fed to leave interest rates unchanged at 3.75%-4.00% at its October 27-28 meeting, while pricing in an 85% probability of a rate hike in December ), Mitrade near 70% ( CME FedWatch prices a December hike near 70% ), and the Admirals Oct 9 table showing 75-85%. https://fxstreet.com/news/euro-struggles-as-french-fiscal-concerns-and-firm-us-dollar-dominate-202610091544 ; https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-09-29] Forbes reported fixed-income markets had been pricing back-to-back hikes, and crucially that if the Fed does not raise rates in October, markets see a hike on Dec. 9 as almost certain — meaning the October-hold scenario (now the dominant expectation) is explicitly framed by markets as funneling probability mass onto a December hike rather than canceling it. https://www.forbes.com/sites/simonmoore/2026/09/29/what-to-expect-from-interest-rates-for-the-rest-of-2026/ - [2026-10-07] The September FOMC minutes already recorded that "most participants" saw another increase as likely appropriate "by year end" — the only two remaining 2026 meetings are October and December, and with October odds collapsed to ~17-18%, December is the sole remaining vehicle for delivering on that committee-wide guidance. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 BOTTOM LINE: The strongest case for YES rests on convergence of (1) explicit, fresh hawkish guidance from a sitting Governor (Waller, Oct 8) that more hikes are needed and need not be consecutive, (2) Goldman's base case of a December 25 bp hike even amid two-hike speculation, (3) a dot-plot arithmetic that points to exactly one more 25 bp move, and (4) reaccelerating inflation nowcasts and rising inflation expectations — all reinforcing market pricing of roughly 70-85% odds of a December hike as of Oct 9-10, with October widely expected to be a "hawkish hold" that defers rather than cancels the move. NOT FOUND: No data yet from the October 27-28 FOMC decision or the September CPI print (due Oct 14), both of which will materially move December hike odds before resolution; no breakdown distinguishing market-implied odds specifically for a 25 bp December increase versus a 50 bp increase (the CME figure cited bundles "up to 50 bps").

YES means: the real-world outcome where the FOMC raises the federal funds target range upper bound by 25 bps (from the current 4.00%) after its December 8-9, 2026 meeting. This dimension argues the NO case — that the Fed holds (or cuts) in December, leaving the upper bound unchanged (or lower) versus its pre-meeting level. - [2026-10-08] Fed Governor Waller, a leading hawk, explicitly said "There is some flexibility regarding the timing of rate increases. They need not be implemented at consecutive meetings, but should occur within a reasonable timeframe," language markets read as leaving the door open to skipping not just October but potentially stretching the "reasonable timeframe" past December too. https://finance.biggo.com/news/d01e4e7f-f6a0-4a91-a7b6-77ab014b1dde - [2026-10-08] The same Waller remarks were interpreted as "casting doubt" even on an October move, with outlets noting Waller said the Fed still needs "additional hikes" to return inflation to its 2% target, but signaled they need not come at consecutive meetings, further dimming expectations for a second straight increase — a framing that keeps optionality for the Fed to wait out December as well if data stay soft. https://www.zetik.com/news/article/story_id-p008-222348 - [2026-10-09] A survey of 14 brokerages (reported alongside the October-meeting odds table) shows "a de-escalation before the midterms could pull oil and inflation expectations lower" as an explicit listed risk to the hike thesis, and that table shows Citigroup alone forecasts "Citigroup | Rates unchanged in 2026 | 3.75%-4.00%" , i.e. at least one major bank dissents from consensus and expects the "No" outcome outright. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 - [2026-10-02] JPMorgan's chief economist conditioned the December call on continued "sticky" data, writing "It would now take a very strong CPI to make the October meeting live. We continue to look for another hike at the December FOMC meeting, on the assumption that the September and October price reports show still-sticky trends in core inflation" — a conditional call, not a certainty, that fails if inflation surprises to the downside. https://www.bnnbloomberg.ca/business/economics/2026/10/02/fed-may-skip-october-but-pull-us-rate-hike-trigger-in-december/ - [2026-10-02] Vanguard's senior economist argued the weak jobs data "strengthens the case for the Federal Reserve to remain patient... giving policymakers reason to wait for additional data," a rationale that applies with equal force to December if further labor softening appears before then. https://www.cnbc.com/2026/10/02/fed-rate-hike-odds-decline-after-september-jobs-report.html - [2026-10-09] St. Louis Fed President Musalem's remarks that more tightening "may be needed over the next six to nine months" imply a horizon that could extend beyond December, consistent with a pause strategy rather than a guaranteed December move. https://kalkine.ca/news/daily-wrap/what-did-waller-say-about-hikes-and-ief-nasdaqief-1 - [2026-10-07] Chicago Fed President Goolsbee's public comment that "There is plenty of room for anything to be on the table" when asked whether the Fed should hike or pause underscores genuine internal division, not a settled plan to hike in December. https://www.bnnbloomberg.ca/business/economics/2026/10/02/fed-may-skip-october-but-pull-us-rate-hike-trigger-in-december/ - [2026-10-07/09] FOMC minutes language was explicitly hedged ("most participants," "likely appropriate by year end") rather than a committed decision, and this looseness has already proven fragile: hike odds for the October meeting alone swung from "a 55% chance of a hike in October, and an almost 75% chance in December" in August to roughly 17% for October by October — showing December pricing is similarly vulnerable to reversal on a single data surprise (e.g., the delayed Sept CPI on Oct 24, Oct jobs report, Nov CPI). https://www.cnbc.com/2026/08/07/odds-the-fed-hikes-in-september-tumble-following-big-july-jobs-miss.html - [2026-09-02] No government-shutdown threat currently clouds the December meeting: a continuing resolution signed September 2, 2026 funds the government "through December 11, 2026 — a date that lands 38 days after the November 3 midterm election" , so BLS/CPI data should flow normally into the Dec 8-9 meeting, removing one argument for an automatic hold but also meaning the Fed will have full information to justify standing pat if data (CPI Oct 14, Oct 24 delayed-release risk from the 2025 shutdown precedent, Nov jobs) cool further. https://polymarkettrader.com/events/us-government-shutdown-october-2026/ - [2026-10-09] Even bullish-for-hike trackers concede the December hike is not unanimous consensus: the same table shows a spread among 10 forecasters, with at least one (Citigroup) outright dissenting and the FOMC's own median dot (one hike by year-end) technically satisfied whether that hike lands in October or December — meaning if October does deliver a surprise hike (BofA's lone call), the Fed could then hold in December and still fulfill its one-hike guidance, resolving this specific December-meeting question NO. https://admiralmarkets.com/analytics/traders-blog/fed-rate-decision-october-2026 BOTTOM LINE: The core NO case rests on three reinforcing points: (1) senior Fed voices (Waller, Musalem, Goolsbee) have deliberately preserved optionality and avoided committing to a December hike specifically, explicitly decoupling "more hikes needed eventually" from "hike in December"; (2) the same soft-labor/cooling-inflation dynamics that killed October's hike odds within one week could plausibly recur before December given CPI (Oct 14), additional jobs reports, and midterm-adjacent political pressure; and (3) if the Fed instead hikes in October (a live scenario per BofA), it may satisfy its "one more hike" 2026 guidance and hold in December, directly producing a NO resolution for this specific contract. NOT FOUND: No official Fed funds futures probability specifically isolating the December 9 meeting from the Fed itself (only third-party CME FedWatch/Kalshi reproductions); no confirmed post-October-meeting Fed statement (meeting hasn't occurred) that would pin down whether October absorbs the "one hike" already, which is the single biggest swing factor for a December NO.