Fed hike odds for October 28 have fallen to 18.3% after soft jobs and inflation data, CME’s FedWatch tool shows. Cut odds sit at 0%, so a hold is the base case.
A hold would not mean relief, though. The Fed raised rates in September, its first hike since 2023, and a December hike remains in play.
Why Are Fed Hike Odds Fading While Cuts Stay Off the Table?
FedWatch, which turns futures prices into probabilities, put hike odds at 37.6% on September 30. Now, on October 8, those chances sit at around 18%. Then employers added just 29,000 jobs in September against forecasts near 90,000.
Inflation data also surprised lower. The core Personal Consumption Expenditures (PCE) price index, the Fed’s preferred gauge, rose 0.2% in August, below forecasts.
Fed Vice Chair Philip Jefferson and New York Fed President John Williams also signaled no rush to act again.
Cuts look remote for another reason. Most Federal Open Market Committee (FOMC) participants saw another 2026 hike as likely appropriate, the September meeting minutes showed.
Energy costs add pressure. Oil had climbed about 14% in the month to September 29, to above $96 a barrel, Yahoo reported.
Can a Hold Help Bitcoin if Yields Stay High?
A hold could remove one threat to the Bitcoin price. The hike, however, has only moved to December, where Goldman Sachs now expects it.
Bitcoin jumped within minutes of the weak jobs report, burning about $27.5 million in short positions in an hour, CoinGlass data shows.
Yields complicate the picture. The 10-year Treasury yield touched 5.342% on October 1, its highest since early 2002.
Analyst Benjamin Cowen argues bond traders partly fear the Fed will tighten too little, which is pushing yields higher. He expects fear to peak around the October 28 meeting.
A hold therefore tests whether traders read a delayed hike as relief or as a larger bill later. With 16 of 18 Fed officials projecting another hike, October 14 inflation data may outweigh the decision itself.
