October CPI report: prices rose 0.4% and core 0.3%, meeting Waller's bar for a bigger move, and 50 bp December hike odds more than double
The Bureau of Labor Statistics did not publish a 12-month inflation rate this time. Last year's government shutdown meant October 2025 prices were never collected, so there is no base month for the annual comparison; the BLS confirmed the gap in advance. Monthly changes were published as usual. September's headline gain was 0.6%, so October's 0.4% is a slowdown, but core matched September's 0.3%, per Bloomingbit's summary of the release. Speaking in London before the data, Waller said he would back a quarter-point hike in December even if inflation improved, and that a 50 bp move "should be considered" if core rose 0.3% or more, according to Reuters.
What the market is pricing
December FOMC outcomes before and after the release:
| December 9 decision | Polymarket before (13:21 UTC) | Polymarket after (13:49) | Kalshi before (13:21) | Kalshi after (13:48) |
|---|---|---|---|---|
| Hike 25 bp | 87.5% | 84.5% | 88.0% | 83.5% |
| Hike 50 bp or more | 4.3% | 10.7% | 5.0% | 9.0% |
| No change | 6.5% | 2.5% | 7.5% | 4.0% |
Adding the two hike outcomes, the venues now price some kind of December hike at about 92.5% to 95%, little changed from 92% to 93% before the print. The bigger change is in the shape: probability has moved from no change toward a half-point move. For January 2027, Kalshi prices a further 25 bp hike at 32.0%, up from 27.0% before the report. The full board is on BetG8's live Fed rate decision odds page.
Why a tenth of a point matters
Markets had already priced a December hike after a 165,000-job October payrolls report and after several Fed officials, including Austan Goolsbee and Tom Barkin, signaled concern about inflation. The open question was size. Waller had effectively published a decision rule hours before the release, and core at 0.3% put the outcome on the hawkish side of it. That is why the 50 bp contract roughly doubled on both venues while the overall hike probability barely changed. A 50 bp move would still be unusual, and it would need broader support on the committee than one governor's remarks.
Cross-market reaction
Risk assets slipped. SPY traded about 0.7% below Monday's $752.69 close in pre-market trading, according to a Twelve Data reading logged by BetG8's macro desk at 13:43 UTC, and bitcoin fell below $74,000 on Binance minutes after the release. Lower oil prices had helped equities on Monday, with Brent falling under $90 on Tuesday morning, as covered in our Brent crude report, but energy relief has not been enough to change the core trend that the Fed is watching.
What to watch next
Further data before the December meeting, including producer prices, and comments from other Fed officials on Waller's 50 bp framing. On the markets themselves, watch whether the 50 bp contracts hold above 10% once the first reaction fades, and whether Kalshi and Polymarket converge; gaps of a point or two after a data release often narrow quickly.
Method and limits
Polymarket prices after the release come from the public Gamma API at 13:49 UTC; Kalshi prices and the 13:21 UTC readings come from BetG8's live Fed page, which reads both venues every five minutes, so readings can lag by up to that interval. CPI figures are as reported by Bloomingbit and CoinDesk from the BLS release; the absence of an annual rate is explained in the BLS shutdown FAQ. Waller's remarks are as reported by Reuters. Prices are not forecasts and nothing here is investment advice.
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Frequently asked questions
What was the October 2026 CPI?
Headline CPI rose 0.4% in October and core CPI rose 0.3%, against forecasts of 0.3% and 0.2%. The BLS did not publish a 12-month rate because October 2025 prices were not collected during the shutdown.
What are the odds of a 50 bp Fed hike in December?
At 13:49 UTC on November 10, 2026, Polymarket priced a 50 bp or larger December hike at 10.7%, and Kalshi at 9.0% at 13:48, up from about 5% before the CPI release.
Is a December Fed hike likely?
The venues price some December hike at about 92.5% to 95%, with a 25 bp move the most likely single outcome at about 84%. That is a market price, not a forecast.
Sources
- Bloomingbit, US October CPI above forecasts
- CoinDesk, U.S. CPI rose stronger than expected 0.4% in October; core rate rose 0.3%
- Reuters via SRN News, Fed's Waller plans to support at least a quarter-point rate hike in December
- BLS, 2025 federal government shutdown impact on the CPI
- Polymarket, Fed decision in December?, read 13:49 UTC, November 10, 2026
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