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Interest Rates · October 23, 2026 · 2 min read

Futures markets price 92% chance of October Fed hold, 78.5% odds of a hike by December

By Econ Data Tools Editorial Team

Published October 23, 2026 • Updated October 23, 2026

Reviewed by Instinct source QC

CME FedWatch-based pricing tracked October 23 shows a 92.0% probability the Federal Reserve holds its 3.75%-4.00% target range at the October 28 meeting, with December pricing implying a 78.5% cumulative probability of at least one quarter-point increase by year end. The hawkish tilt follows a 1.3% September PPI surge and 0.8% retail sales growth.

Interest rate futures are pricing a 92.0% probability that the Federal Reserve leaves its federal funds target range unchanged at 3.75% to 4.00% at the October 27-28 meeting, according to CME FedWatch-based pricing tracked by Investing.com's Fed rate monitor as of 5:15 AM Eastern on October 23. Traders assign an 8.0% probability to a quarter-point increase at that meeting. For the December 9 meeting, pricing implies a 21.5% chance of a hold, a 72.3% probability of one quarter-point increase to 4.00%-4.25%, and a 6.2% probability of 50 basis points of cumulative tightening - a combined 78.5% chance of at least one rate increase by year end. The effective federal funds rate stood at 3.88% as of October 21, according to the New York Fed data published through FRED. The hawkish repricing follows a string of firm data. The Producer Price Index for final demand rose 1.3% in September, the largest monthly advance since March 2022, with final demand goods up 2.6% - the largest increase since the series began in December 2009 - and energy prices jumping 10.8%, the Bureau of Labor Statistics reported. On a 12-month basis, final demand prices climbed 6.3%. Consumer spending has also held up: advance retail sales rose 0.8% in September, double the 0.4% economists expected, though sales excluding autos and gasoline slowed to 0.25%. Initial jobless claims fell to 194,000 in the week ending October 17. Benchmark Treasury yields have stayed elevated, with the 10-year at 4.96% and the 30-year at 5.29% as of October 22.

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