Finance
The Fed Calls Another Hike Reasonable as the 10 Year Tests an 18 Year High, and Sound Money Gets Its Cue
New York Fed President John Williams said Thursday that another interest rate hike this year is a reasonable expectation, speaking at the London Macro Policy Forum. Markets heard him clearly. CME's FedWatch tool put the odds of an October increase at 77.5 percent, up from about 53 percent a day earlier. The FOMC meets October 27 and 28, and Williams declined to commit to a date, noting the era of explicit forward guidance is over.
The backdrop is a genuine regime change. The Fed raised rates on September 16 for the first time since July 2023, lifting the federal funds range to 3.75 to 4 percent under Chairman Kevin Warsh. Sixteen of 18 policymakers project at least one more hike this year, and officials now expect inflation to return to 2 percent only in 2029. The 10 year Treasury yield sits near 5.13 to 5.18 percent, an 18 year high, and the average 30 year mortgage rate hovers just below 7 percent.
Through it all, Bitcoin trades near 84,600 dollars, up 8.4 percent over seven days, holding above its 50, 100, and 200 day moving averages, with the Fear and Greed index reading 71. The crypto market's cycle gauge sits at 41, squarely in its Growth phase. Sound money is absorbing the tightest policy in years and still printing green weeks.
The overlooked dynamic is that this is a hiking cycle into strength. Equities sit near records, gold trades near 4,360 dollars, and the bond market is pricing honesty instead of fear. Williams framed inflation as the big challenge, with tariff pressure and energy shocks in the background, and the market is cooperating with the medicine rather than revolting against it.
For borrowers, the fed funds rate is only part of the picture. Fixed mortgage rates follow the 10 year Treasury yield, which briefly topped 5 percent earlier this month and pushed the average 30 year rate just below 7 percent, according to Freddie Mac data cited by Mortgage Professional. Fed Governor Michael Barr said Wednesday that further policy adjustments are likely needed to bring inflation to target in a timely fashion. The message from the whole committee points one way, and the bond market has already moved there.
For readers, the playbook is patience with a thesis. Every month that Bitcoin holds its ground while the 10 year climbs is another data point for the sound money case. The Fed is telling you the cost of dollars will keep rising. Plan accordingly.
Quick answers
What is this story about?
New York Fed President John Williams said Thursday that another interest rate hike this year is a reasonable expectation, speaking at the London Macro Policy Forum. Markets heard him clearly. CME's FedWatch tool put the odds of an October increase at 77.5 percent, up from about 53 percent a day earlier. The FOMC meets October 27 and 28, and Williams declined to commit to a date, noting the era of explicit forward guidance is over.
Why does this story matter?
For readers, the playbook is patience with a thesis. Every month that Bitcoin holds its ground while the 10 year climbs is another data point for the sound money case. The Fed is telling you the cost of dollars will keep rising. Plan accordingly.
Sources
- Mortgage Professional: Another Fed rate hike is reasonable, but timing stays murky
- CryptoCycleIndex: Crypto market Sep 25, Bitcoin $84,005, Fear and Greed 71
- WEEX: TradFi daily brief, September 25, 2026
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