Data as of: Friday, October 2, 2026 close Issued: Saturday, October 3, 2026 Evidence key: CONFIRMED (primary source), REPORTED (multiple outlets), RUMORED (unverified market reporting), ANALYTICAL (inference).
The Federal Reserve’s September 16 hike to 3.75–4.00% — unanimous, the first since July 2023, under Chair Kevin Warsh — collided with Friday’s jobs data. September payrolls added just 29,000 against roughly 90,000 expected; unemployment ticked to 4.2%; July was revised to negative 10,000. October-hike odds fell from about 70% a week earlier to 34%. December remains the base case for one more move — the dot-plot median points to 4.1% by year-end, with 16 of 18 officials seeing another hike.
Warsh’s framing is unapologetic: inflation “too high… for too long,” financial conditions “nowhere near restrictive.” The statement dropped the line about supply shocks from energy even as the Iran war drives the energy shock forcing the committee’s hand. The SEP projects 2026 GDP at 2.3%, PCE inflation at 3.7%, unemployment at 4.1%.
Treasury is leaning against the long end where it can: it used its full $6 billion buyback limit on October 1, buying deeply discounted 2041/2042 bonds. October brings $39 billion of 10-year and $22 billion of 30-year auctions. The arbiter of the October 28 FOMC is the October 14 CPI — soft number, and the hiking cycle likely pauses; hot number, and Warsh hikes into weakness.