NY Fed's Williams calls another 2026 rate hike 'reasonable'; odds of Oct hike rise to ~75%, 30-year yield hits 5.447% (highest since 2004)
What happened
On Thursday, Sep 24, 2026, NY Fed President John Williams told the London Macro Policy Forum that 'it's likely that another rate hike may be appropriate by the end of the year. That seems to me a reasonable way of thinking about it,' calling inflation the 'big challenge' and saying the Fed has 'a lot of work to do.' Futures immediately repriced: the CME FedWatch-implied probability of a 25-bp October hike jumped to ~77.5% from ~53% a day earlier (Barron's/Dow Jones cited 75%, up from 71% Wednesday and 55% a week ago), with odds of two more hikes by year-end rising to 58% from 42%. The 30-year Treasury yield hit 5.446–5.447% — its highest since 2004 — and the 10-year reached 5.145%, its highest since 2007.
Why it matters & what’s next are part of Pro, along with the audio summary.
Start your free 14-day trialWho’s affected
- Broad equities — negative via higher discount rates, especially rate-sensitive growth/tech and the AI-capex complex. Homebuilders and REITs — higher mortgage and financing costs. Highly leveraged small-caps — higher debt-service burdens. Banks — modestly positive via net interest margins, but offset by credit risk.
Sources