Persistent inflation above the Federal Reserve’s 2% target, with August core PCE at 3% and headline near 3.4%, combined with a resilient labor market at 4.1% unemployment, underpins the 69% market-implied probability of exactly two 25-basis-point hikes in 2026. The FOMC’s September 25 bp increase to the 3.75–4% range, followed by minutes showing most participants favoring one additional move by year-end, has aligned trader consensus with a December hike while pricing October largely as a hold. Futures and dot-plot medians at 4.1% for end-2026 reinforce this path, though softer incoming CPI or payroll data could still shift the final tally.