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Will the Fed raise rates in October 2026? What the odds say

After September's hike, will the Fed raise rates on October 28? Live Kalshi and Polymarket odds, how they compare with CME FedWatch, and what moves them.

By Kristian FagerlieFounder & CEO, Sikt Intelligence

Short answer: the markets expect a pause. As of Oct 8, 2026, Polymarket puts the chance that the Fed holds rates at its October 27–28 meeting at 84%, and the chance of another 0.25-point hike at 16%, with almost no chance of a cut. Odds on this page update automatically every few hours.

Where rates stand

On September 16, 2026, the Federal Reserve raised its target range by a quarter point to 3.75–4%, in a unanimous 12–0 vote. Its statement was blunt: "Inflation remains elevated. Today's policy action will support a timelier return to the Committee's 2 percent goal" (Federal Reserve).

The Fed's own projections point to one more step: the median official expects the policy rate to end 2026 at 4.1%, up from 3.8% in the June projections, which implies another quarter-point hike at one of the two remaining meetings, October 27–28 or December 8–9 (Federal Reserve projections).

The odds for October 27–28

OutcomePolymarket
No change84%
25 bps increase16%
25 bps decrease<1%
50+ bps increase<1%
50+ bps decrease<1%

Source: Polymarket, "Fed Decision in October?", as of Oct 8, 2026. The market settles on the upper bound of the Fed's target range. For the full picture, including Kalshi and price history, see our live Fed rate odds.

Looking further ahead, the markets have all but ruled out cuts this year: Polymarket gives 96% to no rate cuts at all in 2026, and Kalshi puts the chance of at least one cut before 2027 at 5.1%.

Why the odds swung

The October decision has been a moving target. After a hot inflation reading and comments from Fed Governor Michael Barr, markets briefly made a hike in October the favorite (CNBC, September 23). Then the September jobs report came in weak: employers added just 29,000 jobs against expectations of about 84,000, and unemployment rose to 4.2% (CNBC). Traders quickly pulled back their bets on an October hike (CNBC, October 2).

That is the Fed's dilemma in one sentence: inflation argues for hiking, a softening job market argues for waiting.

Prediction markets vs. CME FedWatch

The best-known gauge of Fed expectations is CME's FedWatch tool, which works the probabilities out from the prices of 30-day fed funds futures. Prediction markets ask the question directly: you buy "hike" or "hold" and get paid if you are right. The two usually tell the same story, but they can differ for good reasons:

  • Different rules. Each market defines the outcome in its own way, for example by the upper bound of the target range. Read the rules before comparing numbers; see prediction market odds, explained.
  • Different traders. Fed funds futures are mostly traded by institutions with real interest-rate exposure; prediction markets draw a wider crowd.
  • Long shots. Small probabilities, such as a surprise cut, tend to be overpriced in prediction markets (the favorite-longshot bias).

When the two disagree by a lot, that gap is worth a closer look.

What could move the odds before October 28

  • Inflation data. The September consumer price index, due in mid-October, is the next big test of whether inflation is cooling.
  • More labor data. Weekly jobless claims and any revisions to the weak September report.
  • Fed speakers, until the blackout. Fed officials stop speaking publicly about policy from the second Saturday before a meeting, which this time is October 17.
  • The decision itself. The statement comes out at 2:00 p.m. Eastern on October 28, followed by the chair's press conference.

Why investors watch these odds

A Fed decision moves almost everything at once: bond yields, the dollar, mortgage rates and stock valuations. That is why professional investors increasingly treat event probabilities as an input in their own right, alongside futures and options (see how hedge funds and quant firms use prediction markets).

The market's number is one view. Sikt Intelligence is building a second: an AI superforecaster that reads the news and data that exist today, checks every source, and gives an honest probability next to the market's price, so the gap between the two is visible at a glance. Leave your email below for early access. Nothing here is financial or investment advice.

Key takeaways

  • The Fed raised rates to 3.75–4% on September 16, 2026, citing elevated inflation, and its median official expects one more hike this year.
  • As of Oct 8, 2026, Polymarket gives 84% to a hold and 16% to a hike at the October 27–28 meeting.
  • A weak September jobs report (29,000 jobs, 4.2% unemployment) pulled hike odds down after they had briefly made a hike the favorite.
  • Markets have all but ruled out rate cuts in 2026.
  • Compare prediction markets with CME FedWatch, and read each market's rules before trusting a gap.

FAQ

When is the next Fed meeting?

October 27–28, 2026. The decision is announced at 2:00 p.m. Eastern on October 28. The last meeting of the year is December 8–9.

Will the Fed raise rates in October 2026?

The markets lean against it. As of Oct 8, 2026, Polymarket gives 84% to no change and 16% to a quarter-point hike. The Fed's own projections still point to one more hike in 2026, at this meeting or in December.

Will the Fed cut rates in 2026?

Very unlikely, according to the markets: Polymarket gives 96% to no cuts at all this year. The Fed raised rates in September and its officials expect to raise them again.

What is CME FedWatch?

A tool from CME Group that converts the prices of 30-day fed funds futures into probabilities for each Fed meeting. Prediction markets such as Kalshi and Polymarket price the same decisions directly.

Sources

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