U.S. September FOMC Rate Hike Probability at 93%: Why It Reflects Market Pricing, Not a Confirmed Decision
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The probability of a U.S. interest rate hike in September has been priced in at approximately 93%. However, this is not a probability announced by the Federal Reserve. It is an estimate derived from expectations reflected in the interest rate futures market. As of 00:39 KST on 2026-09-16, the FOMC's final decision had not yet been announced, and the current federal funds target range was 3.50–3.75%.
If a 0.25%-percentage-point increase is approved at this meeting, the target range will become 3.75–4.00%. However, the market-implied probability of 93% must be distinguished from the FOMC's actual decision.
93% Is Not a Rate Hike Probability Announced by the Fed
The figure 93% is not an official indication from the Federal Reserve. It is a probability calculated from market participants' expectations reflected in interest rate futures prices.
CME FedWatch uses prices of 30-day federal funds futures to show market expectations for how the target interest rate may change at upcoming FOMC meetings. Therefore, the figure 93% can change even before the FOMC announcement if market conditions shift.
In fact, by September 15, the interest rate futures market had priced in a probability of a rate hike at this meeting that was well above 90%. Rather than interpreting 93% as meaning that a rate hike has been confirmed, it is more accurate to understand it as a sign that the market is leaning strongly toward an increase.
What Will the Interest Rate Be If the Fed Raises It This Time?
The current federal funds target range is 3.50–3.75%.
If the Fed raises rates by 0.25% percentage points at this meeting, as the market expects, the target range will become 3.75–4.00%.
The author's calculation is as follows.
3.50% + 0.25%p = 3.75%
3.75% + 0.25%p = 4.00%
At the previous FOMC meeting in July, the committee maintained the target range at 3.50–3.75%, although 3 member preferred a 0.25%-percentage-point increase. The decision at that time was 9 to 3.
Therefore, when assessing the September meeting, it is important to look beyond the market-implied probability of a rate hike and examine how the actual voting results change.
Expectations Have Changed Dramatically in Just One Week
As recently as early September, economists' forecasts differed considerably from current market pricing.
In a survey of economists conducted from 4 to 9 in September, 65 out of 93 respondents, approximately 70%, expected the Fed to maintain the 3.50–3.75% target range at its September meeting. The remaining respondents expected a 0.25%-percentage-point increase.
However, by September 15, the probability of a rate hike implied by the interest rate futures market had risen above 90%. Some major financial institutions also changed their forecasts from holding rates steady to expecting a 0.25%-percentage-point increase.
The important distinction is that an economist survey and interest rate futures market pricing are two different indicators. The 70% forecast for unchanged rates and the approximately 93% probability of a rate hike should not be interpreted as figures from the same survey that reversed within a few days.
The two figures differ in both their methodologies and reference dates.
Some FOMC Members Already Favored a Rate Hike in July
The outcome of the previous FOMC meeting also provides an important point of comparison for assessing the upcoming decision.
At the FOMC meeting held from 28 to 29 in July, the committee maintained the federal funds target range at 3.50–3.75%. At that time, 9 members supported keeping rates unchanged, while 3 member preferred a 0.25%-percentage-point increase.
In other words, the discussion of raising interest rates did not suddenly emerge for the first time at the September meeting.
Nevertheless, the fact that a member favored a rate hike in July does not establish that an increase will occur in September. The actual vote and policy statement from this meeting must be checked after the September decision is released.
When Can the Results Be Checked in South Korea?
The September FOMC meeting will take place over two days, from 15 to 16 in September, U.S. local time.
According to the Federal Reserve's schedule, the policy decision will be released at 2 p.m. U.S. Eastern Time on September 16, and the press conference is scheduled to begin at 2:30 p.m.
Because the U.S. East Coast is observing daylight saving time during this period, the corresponding times in South Korea are 3 a.m. on September 17 for the policy decision and 3:30 a.m. for the press conference.
Therefore, as of 00:39 KST on September 16, it is still premature to say that the United States has raised interest rates this week. The accurate description is that the market is pricing in a very high probability of a 0.25%-percentage-point increase at this FOMC meeting.
Three Things to Watch Alongside the Interest Rate Immediately After the Announcement
The first is the actual target interest rate. The most immediate question is whether a 0.25%-percentage-point increase is approved or whether the current 3.50–3.75% range is maintained.
The second is the vote. Because 3 member favored a rate hike at the previous meeting, the number of members voting for an increase or a hold at this meeting will be a key figure for comparison with the previous decision.
The third is the economic projections released alongside this meeting. The September meeting is scheduled to include the Federal Reserve's economic projections. To understand not only a single interest rate adjustment but also the future path of monetary policy, it is necessary to examine the new projections and the press conference as well.
The figure 93% does provide a concise snapshot of current market sentiment. However, 93% is not the FOMC decision itself.
When the actual policy decision is released at 3 a.m. KST on September 17, the most accurate approach will be to first check whether market expectations matched the actual outcome.
※ This article is provided for informational purposes to help readers understand market developments and does not constitute investment advice or a recommendation to buy or sell any particular security or asset. All final investment decisions and associated responsibilities rest with the individual investor.
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