Will the Fed Raise Rates Wednesday? Markets Say Very Likely

Markets see about an 88% chance the Federal Reserve will raise rates on Wednesday. MarketWatch

The decision is due at 2 p.m. Eastern on Wednesday, September 16, 2026. Kiplinger The meeting is a two-day Federal Open Market Committee meeting running September 15-16, 2026. Reuters The Fed has held rates steady all year. The S&P 500 is up more than 12% in 2026 while rates stayed on hold. MarketWatch

Talk of September is not new. In July, markets saw a one-in-three chance of a hike that month, while most on Wall Street expected the central bank to wait until September. MarketWatch By late July, markets saw 91.5% odds of at least one hike by the end of 2026 and 59% odds of more than one hike. Investor's Business Daily An economist warned then to watch September, with war clouds pushing energy prices up again. MarketWatch

On September 9, 2026, the consensus reported by Reuters was still for the Fed to hold steady for the rest of 2026. Reuters That call has since been passed by market pricing. Before the meeting, pricing leaned to a hike on Wednesday. Reuters Reuters reported that bond yields were in focus and could threaten the stock rally. Reuters

Retail Sales are due at 8:30 a.m. Wednesday, September 16. MarketWatch The same week brings the Fed meeting plus several housing updates. Kiplinger

The broader context here is how fast the forecast changed. Think of the Fed as the thermostat for the economy. On September 9 the forecast was no change through December. By September 11-14 a September hike looked most likely. The 2 p.m. decision lands late in the U.S. trading day and leaves little time for same-day trading changes. A morning shopping report plus an afternoon rate call means a surprise can quickly change rate bets. Higher fuel costs feed into headline inflation, which means prices in general, and into what people expect. That shapes how the Fed reacts to supply-driven moves. If bond yields, the interest on bonds, rise, loans cost more. Investments sensitive to rates, called duration, and growth stocks feel that shift.

In my view, 88% means likely but not certain. A hold is still possible. The bigger risk is what the Fed says in its statement, forecasts and press conference about more hikes this year. With sales data hours before and housing news the same week, swings can spread fast from rates to credit to stocks.