PomegraFed Rate Hike Odds Jump Above 75% After Strong Jobs Report
Why are Fed rate hike odds up today?
Fed December rate-hike odds rose to about 78% from 70% on Friday after the US added 165,000 jobs in October, far above the 65,000 forecast, which keeps another rate increase likely.
Key numbers
| Jobs added in October | 165,000vs 65,000 expected |
|---|---|
| Unemployment rate | 4.1%from 4.2% |
| December hike odds (CME FedWatch) | 78%from 70% (per [2]) |
| Average hourly pay, year on year | 3.1%+0.4% on the month |
| 10-year Treasury yield | 4.88%+4 bps (per [2]) |
| Aug–Sep job gains revised | +84,000combined upward revision |
What happened
Fed December rate-hike odds rose to about 78% from 70% on Friday after the US added 165,000 jobs in October, far above the 65,000 forecast, which keeps another rate increase likely. The share of people without work fell to 4.1% from 4.2%. Pay per hour was up 3.1% from a year ago. Job gains for August and September were also raised by a combined 84,000. Estimates of the hike odds range from about 77% to 80%, depending on the source.
Why it matters
The Federal Reserve (Fed), the US central bank, now looks more likely to raise its key interest rate again at its December 8–9 meeting. Strong hiring lets it fight high prices without worrying as much about job losses. Higher rates usually make mortgages, car loans and credit-card debt more expensive, and they can weigh on stocks. The Fed held its rate at 3.75%–4.00% on October 28, with two officials voting to raise it.
Who this affects
- MarketbearishMedium impact
- Bond yields rose; rate-sensitive stocks face pressure.
- CompanymixedMedium impact
- Workers gain from solid hiring; borrowers face higher costs.
- CompetitorsneutralLow impact
- UK and euro-area central banks have also raised rates.
- IndustrybullishLow impact
- AI data center building is adding jobs, good for construction.
United States vs Euro Area, United Kingdom
| United States (Fed) | 3.75%–4.00% | Held, Oct 28 | Dec 9 | ~78% |
|---|---|---|---|---|
| Euro area (ECB) | 2.50% | Held, Oct 29 | — | ~67% |
| United Kingdom (BoE) | 4.00% | Raised 0.25 pt, Nov 5 | Dec 17 | — |
As of 2026-11-06
How we got here
Fed holds rates at 3.75%–4.00% in a 10–2 vote; two officials wanted a hike
European Central Bank holds its deposit rate at 2.5%
Bank of England raises Bank Rate to 4%, first hike since 2023
US reports 165,000 October jobs; December Fed hike odds climb
What to watch
- Fed interest rate decision at the December 8–9 policy meeting2026-12-09
- Next monthly US jobs report, which will show whether hiring stays strong2026-12
- Bank of England's next rate decision after its November hike2026-12-17
Educational content only. Not investment advice.
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