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

- [2026-09-16] The Fed's open market page was last updated Sept 16, 2026. The FOMC raised the target range by 25 bps to 3.75–4.00%, its first hike since 2023. Sources: https://www.federalreserve.gov/monetarypolicy/openmarket.htm (the fetched page shows only the update date; the range and vote come from third parties) and https://primerates.com/primerate/fed-meeting-schedule/. One third-party tracker reports a 12–0 vote: https://fedratecalc.com/fomc-meeting-schedule/ - [2026-07-29] The FOMC held rates at its July meeting. Three members dissented in favour of a hike. Energy prices are higher because of the US-Iran war. https://www.cnbc.com/2026/08/07/odds-the-fed-hikes-in-september-tumble-following-big-july-jobs-miss.html - [2026-10-07] The September minutes were released. All participants backed the hike. Almost all saw inflation risks tilted to the upside. Most officials expect another hike this year. https://primerates.com/primerate/fed-meeting-schedule/ and https://www.euronews.com/2026/10/16/feds-warsh-sees-ai-boosting-productivity-but-gives-no-signal-on-next-rate-hike - [2026-10-02] The September jobs report was weak, and a softer CPI had come out the Wednesday before. CME FedWatch odds of an October hike fell to 17%. The December hike was still above 75% on FedWatch and 65% on Kalshi. https://www.cnbc.com/2026/10/02/fed-rate-hike-odds-decline-after-september-jobs-report.html - [2026-10-14] The September CPI was hot. Headline inflation was 3.7% year on year, up from 3.4%. Core was 2.6%. Wholesale prices rose 6.3% year on year. Payrolls rose only 29,000. October hike odds briefly jumped from about 22% to about 50%, then fell back. https://www.euronews.com/2026/10/16/feds-warsh-sees-ai-boosting-productivity-but-gives-no-signal-on-next-rate-hike - [2026-10-14] Forbes, citing CME FedWatch at 2:45pm ET, gave about a 63% chance of a December hike and about 66% for a hold in October. That snapshot is lower than the Oct 16 readings below. https://www.forbes.com/sites/digital-assets/2026/10/14/fed-66-likely-to-hold-rates-steady-following-high-inflation-data/ - [2026-10-16] CME FedWatch put a December 9 hike at about 88.9%, up from 83% a week earlier. The October hold probability was about 85%. https://www.capitaxer.com/fed-rate-hold-odds-jump-to-85-even-as-warsh-offers-no-clues-on-policy-path/ Reuters-sourced reporting gave about 90%. https://financefeeds.com/silver-price-falls-below-57-as-december-fed-hike-odds-reach-90/ Schwab said the chance of a hike before year-end is above 90%. https://www.schwab.com/learn/story/stock-market-update-open - [2026-10-16] Fed Chair Kevin Warsh spoke in Bangkok. He gave no signal on the next move and said he doesn't prejudge meetings. He did say the world had "broadly conformed" to the Fed's expectations since September. https://www.euronews.com/2026/10/16/feds-warsh-sees-ai-boosting-productivity-but-gives-no-signal-on-next-rate-hike - [2026-10-16] UBS Global Wealth Management forecasts a 25 bp hike in December and another in March 2027. https://www.capitaxer.com/fed-rate-hold-odds-jump-to-85-even-as-warsh-offers-no-clues-on-policy-path/ - [2026-10-16] Market backdrop: the 10-year Treasury yield is about 5.1–5.2% and oil is about $110. https://financefeeds.com/gold-price-4166-week-ahead-oil-110-fed-october-meeting-bull-4330-bear-3970 - [2026-10-28] Scheduled: the next FOMC decision is Oct 27–28, a non-SEP meeting with no dot plot. A hold is priced at roughly 83–90%. https://fedratecalc.com/fomc-meeting-schedule/ and https://primerates.com/primerate/fed-meeting-schedule/. Primerates showed an outlier of about 51% hike. If October delivers a hike, the December base would be 4.00–4.25% and the question would still need a further 25 bp move. - [2026-12-09] The resolution event is the Dec 8–9 meeting, with the statement on Dec 9. It is a SEP meeting. Minutes for the October meeting are due Nov 18. https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm and https://www.smartcalendars.ai/en/feeds/fed-fomc-meeting-calendar. The calendar page's dates were not directly visible in the fetched text, which was truncated, so the Oct 27–28 dates come from secondary sources. BOTTOM LINE: The Fed is in a tightening cycle after the Sept 16 hike. Markets priced a Dec 9 hike at about 89–90% as of Oct 16, after hot CPI, and most officials expect another hike this year. Key remaining risks are the Oct 28 decision, the November data (jobs and CPI), and oil and energy prices. Note that the Oct 14 snapshot was lower, at about 63%. NOT FOUND: Primary FedWatch data pulled directly. Prior-year Polymarket or Kalshi December strike prices, which I was told not to report. The text of the Sept 16 FOMC statement and the Sept SEP dot plot. A confirmed full list of the dissents in September.

- [2026-09-16] FOMC voted 12–0 to raise the target range 25 bp to 3¾–4%. This was the first hike since 2023, and the statement said inflation "remains elevated". Confirmed on the Fed page. https://www.federalreserve.gov/newsevents/pressreleases/monetary20260916a.htm - [2026-09-16] The September SEP dot plot put the median year-end 2026 rate at 4.00–4.25%, which means one more 25 bp hike. 16 of 18 participants projected at least one more hike this year, and 4 projected two. The 2027 median is flat. This is a secondary report. https://www.bondsavvy.com/fixed-income-investments-blog/fed-dot-plot - [2026-09-30] The September FOMC minutes said most policymakers judged another increase would likely be appropriate by year-end. They also stressed that decisions are data-dependent. Source is a secondary summary. https://tradingeconomics.com/united-states/interest-rate - [2026-09-16] Wells Fargo called the September hike an "inflation-risk-management increase", not necessarily the start of an automatic series. It also noted that Chair Warsh favors minimal forward guidance. https://www.wellsfargoadvisors.com/research-analysis/reports/fed-rate.htm - [2026-10-02] CNBC reported that the weak September payrolls (+29k) cut October hike odds to about 17%. December hike odds were above 75% on FedWatch and about 65% on Kalshi. I could not open the page itself, so this comes from the search snippet. https://www.cnbc.com/2026/10/02/fed-rate-hike-odds-decline-after-september-jobs-report.html - [2026-10-14] The September CPI report was hot, with headline at 3.7% and core at 2.6%. The CME FedWatch probability of a 25 bp hike in December was about 63% (Forbes, fetched). Capitaxer put it near 89% around the same time, so the sources disagree. https://www.forbes.com/sites/digital-assets/2026/10/14/fed-66-likely-to-hold-rates-steady-following-high-inflation-data/ - [2026-10-16] The rateprobability.com page, dated 10/16, shows 14% for December under "Probability of Hike(Cut)". Its implied post-meeting rate of 3.06% and its parenthesised figures are not consistent with a hike, and it may be stale or mislabeled. I treat it as unreliable. https://rateprobability.com/fed - [2026-10-12] Polymarket's Fed Decision in December market had 25 bps increase at about 75% (Oct 12) and 77% (about Oct 14–17). No change was about 20–23%. Cut brackets were small. https://polymarket.us/category/economics - [2026-08-25] Earlier path of the same market: no change 61%, 25 bps increase 29%, 25 bps decrease 9%. The hike probability rose from 29% in August to about 77% by mid-October. https://polymarket.com/event/fed-decision-in-december-20260729232808632 - [2026-10-12] The Oct 28 meeting is priced as a hold at about 84–86%, so most of the hike risk has moved to December. The Sep–Dec path market had Hike–Pause–Hike at about 69–70%. https://rg.org/news/prediction-markets/polymarket-daily-fed-october-decision-cpi-bitcoin-90000-october-12-2026 - [Reference class, from my own knowledge, not a fetched source] Since the 1990s, the Fed has rarely surprised markets within a few weeks of a meeting. When futures priced a move above about 70% about 7 weeks out, the Fed usually delivered, but not always. Examples: Dec 2015 and Dec 2016 were delivered, and the Sept 2024 cut was larger than the market had priced. Mid-cycle pauses after the first hike are also common. After a first hike, the next-meeting hike rate is mixed (Dec 2015 was followed by a year-long pause). The data between now and Dec 9 will decide this: October and November CPI, October and November payrolls, and the Oct 28 statement. - [2026-10-02] The labour market is mixed (September payrolls +29k vs August +162k). Inflation is elevated and energy-driven, with Middle East and Hormuz risks. Hot CPI supports a hike, and weak jobs data reduce the odds. The Fed's new leadership under Chair Warsh gives minimal guidance, which raises the chance of surprises. https://www.cnbc.com/2026/10/02/fed-rate-hike-odds-decline-after-september-jobs-report.html BOTTOM LINE: Market-based forecasts (CME FedWatch about 63–89%, Polymarket about 75–77%, Kalshi about 65%) and the FOMC dots (16 of 18 see another hike this year) all favour a December 25 bp hike. A Dec 9 hike is still not a done deal: odds swung from 29% to 77% in two months. Market-implied odds for a meeting about 7 weeks out have historically been fairly well calibrated, but the Fed under Warsh gives little guidance. NOT FOUND: A fetched copy of the CNBC article. A clean current CME FedWatch December figure (sources range from 63% to 89%). Economist surveys (Bloomberg, WSJ) for December. Kalshi's current December price. A systematic historical hit rate for Fed moves priced above 70% about 8 weeks ahead.

YES means: the FOMC raises the target range's upper bound by 25 bps at the Dec 8–9, 2026 meeting, from 4.00% to 4.25% if October holds. A hike at the Oct 27–28 meeting would not count, and the question would then need a further 25 bp hike in December. - [2026-10-16] **Most likely path to YES:** the Fed holds Oct 28, then hikes Dec 9 to 4.00–4.25%. Goldman says Warsh's Bangkok comments and other recent FOMC remarks point to a pause in October. It "continue[s] to expect a second and final hike in December." Goldman is the most dovish major house on the terminal rate, and even it has December as its base case. https://cnbc.com/2026/10/16/feds-warsh-says-ai-development-path-will-be-very-bumpy-.html - [2026-10-15] **Dealer consensus (Reuters factbox):** Goldman, J.P. Morgan and Nomura each forecast one 25 bp hike in December, taking the range to 4.00–4.25%. Citigroup was the latest to move its next hike to December. BofA is more hawkish, with hikes in October and December. CME showed 89.5% for December and about 27% for October. A BofA-style October hike would still leave December live for a further hike. I fetched the page, but the extracted text was truncated, so these figures come from the search snippet. https://www.investing.com/news/economy-news/factboxmajor-brokerages-expect-next-fed-rate-hike-in-december-4951431 - [2026-10-13] **Voters on record:** Boston's Collins said she expects it "will be appropriate to raise rates a bit further before the end of the year." She conditioned the timing on incoming data. https://www.investing.com/news/economy-news/feds-collins-sees-another-rate-hike-on-the-table-before-end-of-2026-4947448 - [2026-10-13] **Williams (NY Fed, vice chair of the FOMC):** he said he hasn't changed his view that "one more rate hike" may be appropriate. He sees no need for more beyond that. This makes December a bounded, one-step ask, and he is a centrist. https://www.cnbc.com/2026/10/13/john-williams-fed-rate-hikes-2027.html - [2026-10-08] **Waller (Governor):** he anticipates additional hikes if data come in as expected. He said hikes need not come at consecutive meetings but should come within "an acceptable period of time." Reuters read officials' comments as pointing to an October hold and a likely December hike. That is the sequencing behind the main YES path. https://www.theglobeandmail.com/business/economy/article-us-fed-governor-christopher-waller-rate-path-october-meeting/ - [2026-09-23] **Barr (Governor):** he said "further policy adjustments are likely to be needed." Reuters read his remarks as implying at least two more hikes. He said inflation risks have risen while labor-market risks have receded. Together with Collins, Waller, Williams and Paulson, who dropped her earlier hold stance, this makes the hawkish bloc broad rather than limited to the three July dissenters. https://www.investing.com/news/economy-news/feds-barr-says-further-rate-hikes-will-likely-be-needed-4913382 and https://finance.yahoo.com/economy/policy/article/paulson-is-latest-fed-official-to-say-more-rate-hikes-may-be-needed-142034400.html - [2026-09-17] **Mechanism, SEP numbers:** 15 of 18 participants saw upside risks to core inflation. Core PCE for 2026 was projected at 3.4%, up 0.1 point. The SEP showed stronger growth and lower unemployment than in June. The September dots put the median year-end rate at 4.1%. The other officials' dots are therefore a December-hike case, and December is the only SEP meeting left this year. https://am.jpmorgan.com/us/en/asset-management/adv/insights/portfolio-insights/fixed-income/fixed-income-perspectives/fomc-statement-september-2026/ - [2026-09-16] **Warsh's own stance leans harder than the dots:** at the press conference he disclaimed the SEP ("Those aren't my forecasts"). MUFG read him as wanting quicker and more hikes than the SEP implies, and said he dismissed an SEP path that waits until 2029 to reach 2%. CBS, citing SGH Macro's Tim Duy, said he showed a "true inner hawk." The Chair is not a brake on a December hike. https://www.mufgresearch.com/rates/september-2026-fomc-recap/ and https://www.cbsnews.com/news/fed-rate-hike-warsh-trump-inflation/ and https://cnbc.com/2026/10/16/kevin-warsh-fed-october-rate-hike-interest-rates-markets.html - [2026-09-16] **Supply of YES votes:** the FOMC voted 12–0 in September. Hammack, Kashkari and Logan had dissented for a hike in July. They will not resist a December hike, and the remaining voters have moved their way. https://www.regardsofwallstreet.com/news/september-2026-fed-meeting-dates-hike-odds - [2026-10-16] **Warsh on global tightening:** he praised "synchronous tightening" by other central banks. This cuts both ways, since MUFG noted spillovers could limit the need for Fed hikes. It does show he is not leaning toward reversing course. https://cnbc.com/2026/10/16/feds-warsh-says-ai-development-path-will-be-very-bumpy-.html - [2026-10-14/15] **Data prerequisites for YES:** Waller's framing was a hike if unemployment stays low, growth continues and inflation shows little progress. September CPI at 3.7% headline (reported by colleagues) fits that. A second hot core reading was already in hand, according to Reuters' factbox. The remaining tests are the Oct 28 statement, October and November payrolls and CPI, and oil. https://www.investing.com/news/economy-news/factboxmajor-brokerages-expect-next-fed-rate-hike-in-december-4951431 BOTTOM LINE: The strongest YES case is an October pause followed by a December 25 bp hike. FOMC dots, the voters' speeches, a hawkish Chair, and Goldman, J.P. Morgan, Citi, Nomura and UBS all point that way. YES needs only that inflation does not cool and the labor market does not crack before Dec 9. NOT FOUND: A fetchable Oct 15–17 CME FedWatch page. The Fed's own Oct 28 decision, which is still in the future. Any official saying December is off the table. The Goldman, Hatzius and Williams soft-landing comments are the main counterweight, but they are outside this dimension.

YES means: the FOMC statement of Dec 9, 2026 raises the upper bound of the target range by exactly 25 bp from its pre-meeting level. A hold, a cut, or a hike of 50 bp or more resolves NO. Only a 25 bp move resolves YES. - [2026-10-16] Goldman's Hatzius team reads Warsh's Bangkok remarks and other FOMC comments as pointing to an October pause. It still expects "a second and final hike in December." The NO case is that a one-and-done framing already caps the hike path. If the Fed hikes in October, the pre-December base becomes 4.00–4.25% and December would need a further 25 bp move, which Goldman does not forecast. https://cnbc.com/2026/10/16/feds-warsh-says-ai-development-path-will-be-very-bumpy-.html - [2026-10-01] Reuters, fetched: NY Fed's Williams said there is "no need for urgency." He said "one further upward adjustment" may be appropriate late this year. Jefferson said the committee's judgment "may take more time." Even the dovish-leaning leadership talks about a single further hike conditional on data. This is a conditional commitment, not a decision. https://finance.yahoo.com/economy/policy/articles/fed-may-time-next-interest-173209828.html - [2026-10-01] The same Reuters piece says rising yields since September mean markets are "reassessing" the outlook. Logan said some of the yield rise may be term premium, which can slow the economy and reduce the need to tighten. Market-driven tightening can substitute for a hike. The 10-year was 5.21% on the fetched Yahoo page. https://finance.yahoo.com/economy/policy/articles/fed-may-time-next-interest-173209828.html - [2026-10-14] Goolsbee called the hot CPI "discouraging" but said "we need to get more data." Waller said further hikes need not come at consecutive meetings. Those two comments point to patience. Collins said a further hike before year-end would be appropriate, with timing dependent on data. https://www.bitrue.com/blog/fed-rate-hike-october-2026 - [2026-10-14] Core CPI was 2.6% year on year per the colleagues' report, against 3.7% headline. Gasoline rose 9.1% on the month and accounted for more than half of the headline increase. The Fed can treat this as an energy supply shock. Oil has been volatile: Nov crude was about $91–96 on the Yahoo pages, below the roughly $110 cited earlier. A fall in crude plus a ceasefire is the path to a December pause. https://www.bitrue.com/blog/fed-rate-hike-october-2026 - [2026-10-14] Edward Jones noted in July that a longer US-Iran ceasefire with lower oil would make the inflation outlook "more balanced." The war is the main driver of inflation. A peace deal or Hormuz reopening before Dec 9 would remove the core argument for hiking. https://www.cbsnews.com/news/federal-reserve-interest-rates-kevin-warsh-july-206/ - [2026-10-14] Political-timing precedent: Shore's findings, reported by Yahoo Finance, say the Fed has not acted 67% of the time at meetings that begin in October of election years. RSM expects the hike in December instead. The election is Nov 3, so the political argument is a reason to delay until December rather than skip it. It also suggests the Fed treats a hike as politically costly. Wolfe's Roth said members "would very much prefer not to do it" before the election. https://finance.yahoo.com/economy/policy/article/the-fed-faces-a-politically-fraught-rate-decision-on-the-eve-of-an-election-for-the-third-time-in-a-row-164456429.html - [2026-10-07] The September minutes say participants "approached each meeting with an open mind." They also say future decisions depend on incoming information and the balance of risks. "Most participants" is not the same as the 12 voters, and the hike is described as "likely" appropriate by year-end, not committed. https://www.stocktitan.net/articles/fed-minutes-september-2026-second-rate-hike - [2026-10-07] The minutes also record "almost all" participants saying labor-market risks had diminished. That judgment is fragile. September payrolls came in at +29k against +162k in August, and one more weak print would reverse it. The hike case rests on a labor-market judgment that the data are already challenging. https://pro.thestreet.com/market-commentary/fed-minutes-confirm-hawkish-shift - [2026-10-17] The December hike is not certain even by prediction-market pricing. DeFi Rate's Kalshi/Polymarket average, observed Oct 17, had Dec 9 alone at 76%. "Any hike before 2027" was 80%, and the Oct 28 hike was 14%. That implies roughly 24% for a December non-hike, in line with the colleagues' Polymarket figures. About 4 points of the 2026 hike probability sits in October, so the December-only figure is the cleaner measure. https://defirate.com/prediction-markets/fed-decision-odds/ - [2026-09-30] The dot plot shows 16 of 18 participants expected one more hike. That leaves two who did not. The Sept 23 CNBC piece says there had been speculation the committee might wait until after the midterms and hike in December. If the Fed instead skips both meetings, as a wait-and-see Fed might, the median dot is a forecast and not a vote. https://www.cnbc.com/2026/09/23/market-sees-next-fed-hike-in-october-following-barr-comments-hot-inflation.html - [2026-12-09] Resolution technicalities that favour NO: the market resolves on the statement's change in the upper bound. A hold, a cut, or a 50 bp move all fail the 25 bp bracket. A 12.5 bp move rounds up to 25 under the rules. If no statement appears, the market resolves to "No change." None of these is a likely failure route for a scheduled meeting, but they add small tails. https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm BOTTOM LINE: The NO case rests on a single remaining conditional hike. The Fed has stressed data dependence and "each meeting live," and the inflation shock is energy-led, with core at 2.6% and the labour market weakening. A war de-escalation or a weak Oct–Nov payroll could therefore turn a December hike into a pause. Against that, almost every official source and market (about 76% for Dec 9 alone) points to a hike, so this side relies on tail risks. NOT FOUND: A readable primary copy of the Oct 16 CNBC analysis (fetch failed). The calendar page's meeting dates. Current Economic surveys for December. Any Fed official explicitly ruling out a December hike. A fetched copy of the Fed's September statement.