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Fed & Monetary Policy

Fed officials steer markets away from an October rate increase

Several policymakers said they want more data before the next hike, while others argued rates still have to go higher.

Assembled by Claude from 10 sources at 9 outlets · Friday, October 2, 2026, Evening edition, 5:24 PM EDT · no human byline

Disclosure. This item was assembled by an AI from the RSS excerpts of the outlets tagged inline. No human wrote or checked it before publication. Feed selection and categories are editorial choices by Teresa Lo. Nothing here is investment advice.

What happened

Federal Reserve Vice Chair Philip Jefferson suggested that the central bank could afford to hold off on an interest rate increase for now politico.com. Delivering a similar message on 1 October, Jefferson said any future adjustments in policy should be determined carefully straitstimes.com.

New York Fed President John Williams, a voting member of the Federal Open Market Committee, said he would rather see more data before moving, as did Jefferson reuters.comforbes.com. Reuters reported that the Fed is now seen skipping October but may pull the rate hike trigger in December reuters.com.

Forbes reported that the odds of an October rate increase fell below 30 percent after officials signalled no rush forbes.com. Michelle Bowman, the vice chair for supervision, said the central bank needs to understand the underlying trends in the economy better before taking any action ground.news.

Why it matters to investors

The pullback in October pricing is not a consensus that tightening is over. Minneapolis Fed President Neel Kashkari said in an interview that further rate increases will likely be needed into 2027, while keeping the timing of the next one open actionforex.com.

Dallas Fed President Lorie Logan went further, saying interest rates need to be half a percentage point higher than they are barrons.com. Chicago Fed President Austan Goolsbee told Fox Business Network that a rate hike and a pause are both on the table money.usnews.comreuters.com.

That spread of views means the October meeting is a genuine coin toss rather than a settled outcome, and it leaves the December meeting carrying the weight of the decision reuters.comreuters.com.

What to watch

ING said cooler US jobs growth supports a Federal Reserve pause in October, and that it chimes with the latest comments from Williams think.ing.com. Politico reported that slowing job growth eases the pressure on the Fed to raise rates before the midterm elections politico.com.

Investors watching the next move should track whether the hawks on the committee convert their stated preference into votes. Logan has named a specific destination for rates, and Kashkari has named a horizon, but neither has committed to October barrons.comactionforex.com. Bowman's call for a better read on underlying trends points to the incoming data rather than the calendar ground.news.

Reuters set out the base case as a skip in October followed by a move in December, which would put the decision after the midterm elections rather than before them reuters.compolitico.com. The Straits Times reported that Fed policymakers as a group are leaning against an October rate hike straitstimes.com.

Sources

  1. reuters.com: Fed may skip October but pull rate hike trigger in December - Reuters (2026-10-02)
  2. forbes.com: Odds Of October Fed Rate Hike Fall Below 30% After Officials Signal No Rush - Forbes (2026-10-02)
  3. politico.com: US job growth slows, easing pressure on Fed to hike rates before midterms - POLITICO (2026-10-02)
  4. straitstimes.com: US Fed policymakers lean against October rate hike | The Straits Times (2026-10-02)
  5. money.usnews.com: Fed's Goolsbee Says Rate Hike and Pause Both 'On the Table' - U.S. News Money (2026-10-02)
  6. reuters.com: Fed's Goolsbee says rate hike and pause both 'on the table' - Reuters (2026-10-02)
  7. actionforex.com: Fed's Kashkari Sees More Hikes Ahead, but Keeps October Timing Open - ActionForex (2026-10-02)
  8. barrons.com: Dallas Fed's Logan Says Interest Rates Need to Be Half Percent Higher - Barron's (2026-10-02)
  9. ground.news: Fed Official Bowman Sees No Urgency for a New Interest Rate Hike This Year. (2026-10-02)
  10. think.ing.com: Cooler US jobs growth supports a Federal Reserve pause in October | articles | ING THINK (2026-10-02)