Will the Fed increase interest rates by 25 bps after the September 2026 meeting?

Logged 18 Aug 2026, 02:50 UTC · Brier 0.5929

• Hikes are structurally rare events: the Fed holds or cuts far more often than it raises rates, and a hike requires either an ongoing tightening cycle or a clear inflation resurgence — without evidence of an active 2026 hiking cycle, the base rate anchors this well below 50%.
• My independent read lands a few points below the market's 28.5%; the modest premium over the pure base rate is justified because the market is pricing meaningful tail risk of sticky or reaccelerating 2026 inflation, and $600k daily volume suggests informed flow rather than noise — the divergence is plausibly explained by my lack of visibility into mid-2026 macro data rather than market mispricing.
• With ~29 days to the meeting, one CPI print and one jobs report remain before the decision, so substantial probability mass sits on data surprises in either direction; this compresses my confidence but argues against extreme estimates either way.

What would change it: A hot August CPI print (core above ~0.3% m/m) or explicit hawkish Fed communications signaling a September hike would push this well above 40%.

-5.5 probability points from the market at generation · low confidence · Polymarket

Base rate: Across all FOMC meetings historically, rate hikes occur roughly 15-20% of the time, and conditional on a meeting being in the middle of an established hiking cycle the odds rise sharply only when inflation is clearly reaccelerating.