Fed Rate-Hike Odds for December Rise to 76.9% After Election

Market-implied odds of a quarter-point Federal Reserve rate increase in December rose to 76.9% after Democrats won control of both chambers in the midterm elections, putting U.S. rate expectations in focus.

The probability had previously stood at 70%, while the chance that rates would remain unchanged was 23.1%. A 25-basis-point increase equals 0.25 percentage point.

The figures describe market expectations, not a decision by the Federal Reserve. In a late-October market snapshot, the implied probability of a December rate increase stood at 78.4%.