By Federal Reserve minutes show that most officials thought another interest-rate increase would probably be appropriate before the end of 2026, even though traders now expect the central bank to wait beyond its October meeting. The document does not provide an exact count or say that most officials wanted to move again immediately.
The Federal Open Market Committee voted 12 to zero on September 16 to lift its target range by a quarter point to 3.75% to 4.00%, its first increase since 2023. All participants supported that move because inflation remained elevated, the economy was expanding at a solid pace and labor-market risks had diminished.
What the Minutes Say About Further Hikes
“Most participants” assessed that another increase would likely be appropriate by year-end. Officials also stressed that every meeting remained open and that future decisions would depend on incoming data and the balance of risks.
The reasons were not identical. Many participants saw a higher rate path as insurance against inflation remaining above target because of stronger demand or additional supply shocks. A number regarded higher rates as necessary under their central economic outlook rather than only as insurance. Several said the current rate was not restrictive or was only mildly restrictive.
Some officials said upside inflation risks had increased, pointing to energy costs, resilient spending, AI-related capital investment and the possibility that sector price increases could spread. The language supports another move in 2026, but it does not commit the committee to October.
The Dot Plot Was More Precise Than the Minutes
The September decision was unanimous, but agreement on the completed hike does not mean agreement on the next meeting. The minutes use categories such as most, many, a number and some without identifying participants or giving totals.
The accompanying projections provided a clearer numerical signal. As FinanceFeeds reported, 16 of 18 officials projected at least one more increase by year-end. The projections include governors and regional bank presidents, not only the 12 members who voted in September, and they are forecasts rather than promises.
Inflation Held at 3%, but Hiring Slowed
Data released after the meeting weakened the case for consecutive increases. The core personal consumption expenditures price index rose 3.0% over the year through August and 0.2% from July. The annual rate was unchanged for a third month, leaving inflation above the Fed’s 2% goal without a fresh acceleration in the preferred core measure.
The September employment report showed payrolls increased by only 29,000, compared with an average monthly gain of 45,000 over the previous year. Unemployment held at 4.2%. The result did not show a sharp labor contraction, but it reduced the urgency to tighten again three weeks after the first hike.
Markets Expect a Pause on October 28
CME FedWatch showed an 18.3% probability of another quarter-point increase at the October 27 to 28 meeting, leaving 81.7% on no change. Before the jobs report and other data, the probability had been near 70% in some market readings. It was around 21.6% before the minutes were released.
Polymarket priced a quarter-point October increase near 16%, with approximately $29 million traded in the market. The same platform placed a roughly 75% probability on a December hike. Traders therefore read the Fed’s year-end bias as delayed rather than abandoned.
Gold and U.S. stocks moved little immediately after the minutes because the year-end signal was close to the dot plot already published. Bitcoin reacted more visibly but had also been under pressure from higher yields, a stronger dollar and leveraged liquidations. Gold traded near $4,112 during the session after recovering from a morning low, while bitcoin was near $83,400 in the broader market recap.
CPI Comes Before the Next Decision
The next major test is the September consumer price index on October 14. A stronger core reading or renewed goods inflation could rebuild the case for an October move. A softer report would give officials more reason to wait while preserving the December option.
The minutes answer the year-end question more clearly than the meeting-specific one. Most officials expected another increase, and 16 of 18 projections showed one. The incoming data and market pricing say October may be too soon. That tension is why the decline in near-term hike odds has mattered for gold, bitcoin and rates even as the Fed kept a tightening bias.