Fed December Hike Odds Hit 97% as Waller Floats a Half-Point Move
Traders now see a December Fed hike as almost certain after a 0.4% October CPI reading and Waller’s half-point nod.
The latest inflation data has pushed the market’s view of the Federal Reserve sharply higher. With October CPI up 0.4%, traders are pricing a 97% chance of a December hike, while Fed Governor Waller’s mention of a half-point move has added fresh fuel to the debate.
That combination matters because consumer prices remain central to the Fed’s rate-setting playbook. A monthly gain of 0.4% is the kind of reading that can keep policymakers cautious, especially when they are looking for signs that inflation is easing convincingly rather than simply pausing.
In betting and rate markets, odds do not reflect a final decision. They show where money is leaning, and a move to 97% signals a strong consensus that another hike is coming in December. Waller’s openness to a larger step makes that consensus even more notable, because it expands the range of outcomes traders have to weigh.
Bitcoin’s reaction has become part of the story as well. Digital assets often respond quickly when expectations for interest rates shift, since higher or lower borrowing costs can change the appeal of riskier holdings. That does not settle the question of direction for the next move, but it does show how closely crypto traders are watching the Fed.
What comes next will depend on the data and the tone from policymakers. If inflation stays firm, the December pricing could hold; if it cools, those odds may ease. For now, the market is telling a clear story: the Fed’s next step is being treated as far more likely than not.
