Will the Fed raise interest rates at its October 27-28, 2026 meeting?

The committee now has the data cover for an October move that it lacked on October 12. Core consumer prices rose 0.3% in September against a 0.2% forecast, and core producer prices rose 0.7%. A chair who wants to show he is not the White House's pick could point to those two reports alone. That is the case for October, and it is why the number rises.

The case against is that the people who steer expectations have not pointed to October. On October 13, the day before the CPI report, New York Fed President John Williams told Bloomberg News that it may be appropriate to have one more rate hike and that he saw no reason at this time to expect more in 2027, Reuters reported. He did not name a meeting. Kevin Warsh has not spoken in public since the data, and the pre-meeting blackout begins on October 17. A committee that wanted October would normally use the next two days to prepare markets; staying quiet leaves the market's December lean in place.

Timing adds a cost. October 28 is six days before the midterm elections, and the White House has attacked rate hikes in public. The Fed hiked six days before the 2022 midterms, so the calendar is no veto, but a hike now carries a political audience cost that a December 9 hike, after the votes are counted, does not. The Iran pledge Trump made on October 8 still stands, so no new oil shock is forcing the committee's hand.

Reference class: every rate hike since 2004, read from the Fed's own rate change history, and whether the very next scheduled meeting also hiked. Pooled, 25 of 37 were followed immediately by another (our calculation from the Fed's table). By cycle, the fast cycles of 2004 to 2006 and 2022 to 2023 almost always hiked again at the next meeting, while the gradual cycle of 2015 to 2018 never did.

Closest analogue is still 2018: a September hike under public attack from the President, a skip at the meeting nearest the midterms, and a December hike. The hot September data pull a little toward the 2022 pattern, when the Fed hiked into the midterms, but core inflation then ran far above today's 2.6% annual rate and the committee was in a hurry. Today the vice chair has called for no urgency and has not withdrawn it.

Where the 2018 analogy breaks: every meeting now has a press conference, so October is technically as live as December, and in 2018 core inflation was near target. Two inflation reports above forecast in two days is the kind of surprise that has pulled the Fed forward before, which is why we lift the number rather than hold it.

Start from version 2 at 18%. The pooled base rate is 68% (25 of 37), and we stay far below it for the reason given in version 2: the current cycle follows the gradual 2015 to 2018 pattern, in which no hike was followed by another at the next meeting.

Adjustments. Our CPI signpost was "well above forecasts, or core up 0.4% or more" for +15 points. It half fired: headline came in at 3.7% against 3.6% expected and core at 0.3% against 0.2%, a beat but not a 0.4% print, so we add 8 points. Producer prices are new evidence: the September PPI rose 1.3% against 0.6% expected and core PPI rose 0.7%, so we add 4 points. The signpost for officials naming December did not fire: Williams repeated that one more hike may be appropriate without naming a meeting, so no adjustment. We do not add a separate step for the market repricing to avoid counting the same reports twice.

18 plus 8 plus 4 lands at 30%, with a range of 18% to 44%. The range is wider than before on the upside because a chair or press leak during the blackout could still move the committee toward October.