The Federal Reserve is No Longer Projected to Hike Interest Rates This Month
Forecasts indicate the Federal Reserve is no longer expected to raise interest rates this upcoming month, following comments from Vice Chair Philip Jefferson regarding data-dependent policy adjustments.
Based on forecasts monitored by Polymarket, the Federal Reserve is no longer anticipated to raise interest rates during the upcoming FOMC meeting later this month. This shift follows statements from Fed officials indicating a lack of immediate urgency to implement another rate hike. Vice Chair Philip Jefferson stated on Thursday that although he backed the U.S. central bank’s rate increase last month, he perceives no pressing need for a subsequent move right away.
“Any future adjustments in policy should be determined by carefully examining trends in the data, the evolving outlook, and the balance of risks,” Jefferson explained in prepared remarks for the University of Virginia’s Darden School of Business. Previously, the Federal Reserve increased its benchmark federal funds rate by 25 basis points to a target range of 3.75%–4.00% during its September 16 meeting.
Apprehension regarding a potential additional interest rate increase surfaced this week amid ongoing climbs in mortgage rates. Driven by an ongoing global bond selloff, mortgage rates hit their highest points since late 2023. Data from Mortgage News Daily shows the average 30-year fixed-rate mortgage reached 7.6% as of Wednesday, marking a roughly 15-basis-point increase from the prior week. Such levels have not been observed since November 2023, with rates having jumped by 70 basis points over the past month alone.
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Notwithstanding pressure from the Trump administration to keep lowering interest rates, the Fed under Kevin Warsh has held off on making drastic rate modifications, and its overall strategy remains difficult to decipher. Last month’s rate hike represented the first such increase in a span of three years.
Frequently Asked Questions
01Is the Federal Reserve expected to hike interest rates this month?
No, forecasts tracked by Polymarket indicate that the Fed is no longer projected to raise interest rates at the upcoming FOMC meeting.
02What did Fed Vice Chair Philip Jefferson say about future rate moves?
Jefferson stated that while he supported last month’s interest rate increase, he currently sees no urgency to make another move, emphasizing that future policy adjustments will depend on data trends, the evolving outlook, and the balance of risks.
03How have mortgage rates been affected recently?
Mortgage rates have climbed to their highest levels since late 2023 due to a global bond selloff. The average 30-year fixed-rate mortgage reached 7.6% as of Wednesday, which is up about 15 basis points from the previous week and 70 basis points higher over the last month.
