October Fed Rate Hike Odds Drop to 44% After Williams’ Dovish Remarks

October Fed rate hike odds have taken a sharp U-turn after New York Fed President John Williams said there is no need to rush another rate increase. Odds of a 25-basis-point hike have dropped from above 70% to around 44%.

The shift could give Bitcoin and the wider crypto market some much-needed relief.

Williams Pushes Back Against October Hike

Speaking at the University at Buffalo, Williams said the Fed’s unanimous decision last month to raise rates to 3.75%–4% gives policymakers enough time to assess new economic data before making another move.

“With the policy action we took at our September meeting, there is no need for urgency, and we have time to gather more information.” 

Before Williams’ speech, futures markets priced in nearly a 70% chance of another 25-basis-point hike in October. Those odds later fell to around 44.8%, according to the CME FedWatch Tool.

A prediction market including traders on Kalshi has now turned toward no rate change in October, with those odds rising to 55.2%.

Also, what’s interesting is that the Fed has never raised rates in October ahead of a U.S. election.

Barr Keeps October Hike on the Table

The Fed’s message is not completely one-sided. Federal Reserve Governor Michael Barr said the central bank has been “knocked off course” by strong AI demand and higher oil prices, suggesting that policy may need to be recalibrated.

This puts Barr’s view at odds with Williams’ call for more time to assess incoming data. 

Still, Williams expects another hike later this year if the economy follows his forecast. He also expects inflation to reach 3.5% by the end of 2026.

Bullish News for the Crypto Market

This Fed’s signal could be good news for crypto if rate hikes slow down. The global crypto market cap now stands at $2.95 trillion, almost unchanged over the past 24 hours. 

As of now, Bitcoin accounts for $1.67 trillion, with a market dominance of 56.62%. Meanwhile, around 13,800 BTC left Binance, marking its largest single-day net outflow since 2023. The move comes as Bitcoin trades below $83,213, with more investors moving BTC into long-term wallets.

Altcoins are also seeing stronger activity. Altcoin spot trading volume has reached nearly four times Bitcoin’s volume, while Glassnode’s Altcoin Cycle Signal has climbed above 81.