Persistent inflation, with core PCE at 3.4% and headline projections near 3.7% for 2026, underpins trader expectations for further tightening despite the September FOMC's 25-basis-point hike to the 3.75-4.00% range. The October 2 jobs report, showing just 29,000 nonfarm payroll gains and unemployment rising to 4.2%, sharply reduced October hike odds, favoring a pause there while supporting a December move. Market-implied paths such as Pause-Hike-Pause and Pause-Hike-Hike reflect this sequencing, as officials like New York Fed President Williams signal one additional adjustment this year without urgency for back-to-back action. Upcoming CPI and labor data before the October 27-28 and December 8-9 meetings will likely refine these probabilities amid the Fed's data-dependent stance.