Fed Pause, Then Two Hikes? Pause-Hike-Hike Odds Hit 19%

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Will the Fed Pause in October, Then Hike in December and January? Pause-Hike-Hike Rises to 19%

The Pause-Hike-Hike outcome in Polymarket's Fed decisions (Oct-Jan) market rose from about 10% to 19% over three days to Oct. 21, as an October hold became widely expected. Fed funds futures put October hold odds at 84.5% on Oct. 20, up from 81.2% a day earlier, according to CME FedWatch data reported by Seoul Economic Daily. Nearly all economists in a Reuters poll expect an October skip and a December hike.

Fed Chair Kevin Warsh has given no guidance past that point. "I don't prejudge meetings," he said, declining to signal another hike.

Live market odds

2 venues

Fed decisions (Oct-Jan)

Each outcome's chance, from what traders are paying right now on Polymarket and Predict.fun.

Pause-Hike-HikeIn this story

17%

PolymarketBest price5.56x18¢Predict.fun5.00x20¢

Hike-Hike-Hike

2%

PolymarketBest price45.45x2.2¢Predict.fun25.00x4¢

Pause-Pause-Pause

9%

Predict.funBest price10.00x10¢Polymarket9.09x11¢

Other

4%

PolymarketBest price33.33x3¢Predict.fun14.29x7¢

Compare every venueCents per $1 payout, before fees

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Why the Pause-Hike-Hike Path Doubled: October Hold, December Hike, January Unknown

The October leg firmed after the credit standing of CoreWeave, the largest neocloud provider, deteriorated sharply on Oct. 14. AI and semiconductor stocks weakened, demand for safe assets lifted Treasuries off their highs, and the futures-implied odds of an October hike fell from 22.1% on Oct. 13 to 15.5% on Oct. 20, Seoul Economic Daily reported. On Oct. 20, the Nasdaq slipped 0.02% while the Dow gained 1.02%.

Housing added to the case for a pause. The National Association of Realtors said pending home sales fell 7.3% in September to an index of 66, the lowest since the series began in 2001. The West dropped 9.2% and the South fell 8.2%.

The December leg rests on hawkish inflation pressure. The Fed hiked 25 basis points in September to a 3.75%-4.00% range, and September CPI rose 3.7% year over year. Minutes from the Sept. 15-16 meeting showed most participants expected another hike before the end of 2026, per Next News Network.

The January leg has much less support. No sourced forecast calls for a third consecutive decision ending in a hike, and Warsh's refusal to prejudge meetings leaves the path priced on the first two legs alone. Beyond October's hold becoming consensus, we could not establish a cause for the three-day jump.

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What Could Confirm or Reverse Pause-Hike-Hike: October 27-28 Decision and Beyond

The Oct. 27-28 FOMC decision is the first test. A hold keeps the path alive. A hike or a cut ends it.

Warsh's post-meeting press conference is the next signal. Any language committing to, or ruling out, a December move would reprice the second leg, and any hint about the pace beyond December bears directly on January.

The December 8-9 meeting is the second test. A hike there leaves the January 26-27 meeting as the final leg before the market resolves on Jan. 27, 2027. Between meetings, watch the CME FedWatch December odds and any revision to the Reuters economist consensus. Further AI credit stress or housing weakness would cut against both hikes. Live pricing for every sequence sits on the Fed decisions Oct-Jan odds page.