Fed may raise rates again even if it holds in October, analysts say
US inflation accelerated and analysts now expect a December rate hike. CME FedWatch puts an 83% chance on an unchanged rate at the October meeting.
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what happened
According to Barron's, Federal Reserve officials appear inclined to keep the benchmark rate unchanged at their October 27-28 meeting. The outlet argues that further tightening could still come as soon as December. The Fed raised rates by a quarter point in September, to 3.75%-4.00%, its first increase since 2023.
Inflation data remain worrying. Consumer prices rose 3.7% year on year in September, up from 3.4% in August, while core inflation accelerated to 2.6%. Producer prices jumped 1.3% in the month, the largest monthly gain in four years. Fed officials are split: Mary Daly and Michelle Bowman see no urgency, while Beth Hammack argues for acting sooner. Chair Kevin Warsh said developments matched the Fed's expectations.
why it matters
The key question for markets is a possible December hike. Edward Jones expects one increase then and another in 2027. For US stocks, bonds and the dollar, rate expectations remain sensitive to each inflation report.
market impact
USD and US Treasuries: expectations of tighter Fed policy support yields and the dollar
tags
instruments
sources
- The Fed Will Have to Raise Interest Rates More, Even If It Pauses in October — ru.tradingview.com, 17 October 2026 at 10:30 UTC
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