---
title: "Fed funds futures price a hold on Wednesday and a December hike"
url: "https://etf.net/news/fed-futures-price-hold-december-hike-2026-10-27"
published_at: "2026-10-27T12:51:03.971Z"
updated_at: "2026-10-27T12:51:03.971Z"
byline: "ETF.net Research"
---

# Fed funds futures price a hold on Wednesday and a December hike

September's projections already describe a hold on Oct. 28 and one more increase by year-end, so the open questions are whether anyone votes to raise rates now and whether Chairman Kevin Warsh will say December is still the plan.

By ETF.net Research. Published Oct 27, 2026.

The Federal Reserve decides on Wednesday, Oct. 28, whether to leave its target range for the federal funds rate at 3.75% to 4%. Fed funds futures, contracts that pay based on that rate, put an **89.5%** probability on a hold.

CME Group's FedWatch tool showed that figure early Tuesday, Oct. 27, and an **82.3%** chance the rate is higher by the Dec. 8-9 meeting than it is now. That reading includes this week's 10.5% chance of a hike. It is not the chance of an increase at the December meeting alone.

A rate one quarter point higher by December, and no more, was priced at 73.9%. The rest of the 82.3% is a rate half a point higher.

The Federal Open Market Committee meets today and Wednesday. The decision is at 2 p.m. ET, and Warsh's press conference is at 2:30 p.m. ET. Wednesday brings no new projections. December's meeting does.

That sequence is the one the committee described in September. In the [minutes](https://www.federalreserve.gov/monetarypolicy/fomcminutes20260916.htm) of the Sept. 15-16 meeting, most participants assessed that another increase "would likely be appropriate by year end," and said they would come to each meeting with an open mind. The [median projection](https://www.federalreserve.gov/monetarypolicy/fomcprojtabl20260916.htm) for the appropriate rate was 4.1% at the end of 2026, up from 3.8% in June, and 4.1% again at the end of 2027.

The committee reports that rate as the midpoint of the target range. From today's range of 3.75% to 4%, one more quarter-point increase would make it 4% to 4.25%. The midpoint of that range is 4.125%.

The September median of 4.1% is that step, written to one decimal place. The same 4.1% at the end of 2027 means the median projection stops after it.

The futures and the last projections describe the same near-term path. Warsh has declined to promise it. Dallas Fed President Lorie Logan, who votes this week, has asked for twice that December step.

## The vote is the part that is not priced

On Sept. 16 the committee [voted 12-0](https://www.federalreserve.gov/newsevents/pressreleases/monetary20260916a.htm) to raise the range by a quarter point. Warsh then [told reporters](https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20260916.pdf) he does not pre-commit.

"I'm not in the forward guidance business," he said.

The September statement justified that day's increase and stopped there. It said inflation remains elevated, and that the action would support a timelier return to the 2% goal. It did not date the next move.

On July 29 the committee [voted 9-3](https://www.federalreserve.gov/newsevents/pressreleases/monetary20260729a.htm) to hold at 3.5% to 3.75%. Cleveland Fed President Beth Hammack, Minneapolis Fed President Neel Kashkari and Logan preferred a quarter-point increase. All three voted for the September increase, and all three vote this week.

They are not asking for the same thing now.

Logan [said on Oct. 1](https://www.dallasfed.org/news/speeches/logan/2026/lkl261001) that she estimates the target range "needs to rise an additional 50 basis points or more." Fifty basis points is half a percentage point: two quarter-point steps from here, not the one in the median projection.

[Hammack said on Oct. 12](https://www.clevelandfed.org/collections/speeches/2026/sp-20261012-trimming-the-sails-communicating-my-reaction-function) that, when feasible, she prefers smaller adjustments, made relatively quickly, rather than waiting and risking a larger course correction.

Kashkari told Reuters on Oct. 1 that he was open-minded about further increases and did not have a strong view on whether the next one should come at this week's meeting.

Two voters closer to the center have described a later move.

"There is no need for urgency," New York Fed President John Williams, who votes, [said on Sept. 29](https://www.newyorkfed.org/newsevents/speeches/2026/wil260929).

If the economy evolves as he expects, one further increase may be appropriate late this year, he said.

Governor Christopher Waller, who also votes, [said on Oct. 8](https://www.federalreserve.gov/newsevents/speech/waller20261008a.htm) that if the data come in as expected he anticipates further increases.

"The hikes do not need to come at consecutive meetings," Waller said.

A [CNBC survey](https://www.cnbc.com/2026/10/27/federal-reserve-rate-hike-timing-expectations.html) of 30 fund managers, strategists and economists, published at 7:10 a.m. ET Tuesday, found 93% expecting a pause. Asked what the Fed should do, 30% said raise rates now. Respondents expected at least two dissents if rates stay put.

## Where a surprise would show up

Since the Sept. 16 decision, the 2-year Treasury yield has fallen 6 basis points, to 4.68%, on the [Treasury's published curve](https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?field_tdr_date_value=202610&type=daily_treasury_yield_curve). The 10-year yield ended Monday, Oct. 26, at 5%, 1 basis point below the day of the increase, after touching 5.15% on Oct. 19. The 30-year yield was 5.31%, down 4 basis points from Sept. 16.

Chart: The 10-year at **5%**; the 2-year at 4.68%

The futures already price Wednesday's hold. They do not settle whether December is still the plan, or whether anyone votes for the second step Logan wants.

[iShares 20+ Year Treasury Bond ETF](https://www.ishares.com/us/products/239454/ishares-20-year-treasury-bond-etf), TLT, holds Treasuries maturing in more than 20 years. iShares reported an effective duration of 14.92 years as of Oct. 23. At that duration, a tenth of a percentage point rise in long-term yields cuts the price about 1.5%, and a fall of that size lifts it by about as much.

A hold, by itself, does not move this fund. It moves only if long-term yields move.

[WisdomTree Floating Rate Treasury Fund](https://www.wisdomtree.com/us/products/fixed-income/usfr), USFR, holds floating-rate Treasury notes. WisdomTree says the notes are priced at a spread over three-month Treasury bills, and reported an effective duration of 0.02 years as of Oct. 23. The three-month bill yield was 4.22% on Monday, 8 basis points higher than on Sept. 16.

The fund's price will not register a hold. Its income follows those bill yields.

That income would fall if a December increase comes off the table and bill yields fall with it. It would rise if the extra half point Logan described becomes the path and bill yields rise.

At 2 p.m. Wednesday, see whether the statement dates a further increase, and count the votes. A unanimous hold means Hammack, Kashkari and Logan all voted to wait. Votes for an increase would mean some officials want to move this week, not wait for December.

At 2:30 p.m., the question for Warsh is the one he declined in September: whether another increase by year-end is still the leaning. If he treats it as such, the 2-year yield has little reason to move. If he steps away from it, that yield would fall, and the income on USFR would fall with the bills behind it. TLT moves only if long-term yields move too.

Source: etf.net, https://etf.net/news/fed-futures-price-hold-december-hike-2026-10-27. Please cite the page URL.