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Quick Take

The odds of a 50-basis-point Federal Reserve hike in December rose from 0% to 13.6% on Nov. 10 after October CPI beat forecasts, as Bitcoin fell to an intraday low below $73,000.

Meanwhile, the odds of a 25-basis-point hike climbed from 84% to 86.4%, according to a Nov. 10 CME FedWatch snapshot reported by Barron's.

Headline CPI rose 0.4% versus a 0.3% forecast, and core rose 0.3% versus 0.2%, meeting the condition Governor Christopher Waller set for considering a 50 bps move.

A case in the numbers

The market is pricing more tightening, with 25 bps the dominant outcome. The no-hike probability dropped from 16% to 0%, so the 25 bps odds rose alongside the 50 bps odds.

Weighting the three outcomes, the expected December hike moved from 21.0 bps to 28.4 bps, up 7.4 bps. A 50/50 split between the two sizes would imply 37.5 bps, so the market sits closer to its old expectation than to a 50 bps base case.

The odds ratio favoring 50 over 25 would have to rise more than sixfold before 50 bps became the likelier size.

Dec. 9 decision probabilities from the CME FedWatch snapshot quoted in the supplied article and attributed there to Barron's. Each bar totals 100%.

Source: CME FedWatch — historical snapshot quoted in supplied article

October's report was hotter than forecast and cooler than September on the headline, which slowed from 0.6% to 0.4%. Core stayed at 0.3% for a third month, and transportation services rose 0.8%.

At a constant 0.3% a month, core inflation compounds to about 3.7% annualized, a run-rate calculation that stands apart from an official annual figure. The BLS omitted an annual October comparison, since the 2025 government shutdown interrupted the underlying data collection.

Waller's threshold opens consideration of a 50 bps hike, and committee backing is a separate matter. The Fed held at 3.75% to 4% on Oct. 28 by a 10-2 vote, and both dissenters wanted 25 bps.

Seasonally adjusted CPI-U changes from the preceding month, as reported in the Nov. 10 release. Core excludes food and energy. Month labels refer to the measured month. BLS omitted most October year-over-year comparisons because October 2025 survey data were unavailable.

Source: BLS — October 2026 CPI release, Table A, retrieved Nov. 10

When 50 bps becomes the base case

Three developments could strengthen the case for 50 bps at the FOMC’s December meeting and shape Bitcoin's outlook.

October core PCE on Nov. 25 would need to confirm CPI, with monthly readings near 0.3% to 0.4% and broad price strength, against September's 0.3% monthly and 3.1% annual core PCE gain.

The Dec. 4 jobs report would need to show a labor market that can absorb more tightening. October payrolls rose 165,000 against a 12-month average of 48,000, unemployment was 4.1%, and hourly earnings rose 0.4%.

Several voting members would also need to back faster tightening publicly, and oil and sticky services costs would need to persist.

PPI arrives Nov. 13, the minutes of the October meeting Nov. 18, and the Fed's communications blackout begins Nov. 28, before the Dec. 4 jobs report.

The decision comes Dec. 9, and November CPI lands Dec. 10, one day after the Fed's decision, so officials decide before the next CPI print arrives. Softer PCE or hiring could weaken the case for a half-point increase.

A Reuters poll of 101 economists on Nov. 6 to 10 expects 25 bps in December, to 4.00%-4.25%. Of those, 56 see December as the final hike, while 45 expect at least two further increases in total, including December.

Slower US inflation leaves Waller’s half-point December hike in play

Even a 25 bps move could lift yields and tighten financial conditions if the Fed signals more increases in 2027 than markets expect. For Bitcoin, the risk is not just December's hike size, but a shift toward higher rates for longer. Cross-market moves on Nov. 10 illustrated that pressure.

The two-year Treasury yield rose about 19 bps to 4.74%, the 10-year neared 4.99%, the dollar index gained 0.6%, and gold fell more than 2%.

Bitcoin's downside map

Farside Investors shows US spot Bitcoin ETF net outflows of about $1.5 billion from Nov. 2 to Nov. 9.

Glassnode's Nov. 4 report found about 38% of short-term holder supply in profit, though much of the leverage built since August had cleared and spot volume ran about 1.5 times its pre-rally level.

The leverage reset may reduce the risk of another forced-selling cascade, but it does not rule out further sharp losses.

Daily net flows across US spot Bitcoin ETFs. Trading sessions from Nov. 2-Nov. 9 sum to negative $1.5 billion.

Source: Farside Investors — Bitcoin ETF daily total net flows

In its Nov. 4 report, the firm identified a modeled long-liquidation band at $73,000 to $76,000. These are estimated levels where leveraged positions could be forced to close, not confirmed buying support.

Measured from $73,000, a move to $70,000 would represent a further 4.1% decline; the round number alone does not establish technical support.

Glassnode also identified $60,000 to $63,000, 17.8% to 13.7% below, as a concentration of modeled Bitcoin long liquidations left by a breakout. That liquidation estimate is not a price forecast or a worst-case floor, and the report does not tie it to a particular Fed decision.

Where Bitcoin goes from here

If core PCE cools toward 0.2% month over month, hiring slows, and officials favor quarter-point steps, a 25 bps December increase with a softer outlook would become more plausible. Bitcoin could then recover toward the $75,700 to $77,700 cost-basis levels in Glassnode's Nov. 4 report, provided ETF selling eases.

If inflation stays sticky and employment holds up, a quarter-point increase accompanied by signals of further tightening in 2027 could keep pressure on Bitcoin. The precise downside would also depend on ETF flows, spot demand and leverage.

Continued ETF outflows, weak spot demand and forced selling could deepen a decline, especially if markets price in more aggressive tightening. But neither the liquidation map nor the Fed outlook establishes that Bitcoin will reach $60,000 to $63,000.

The readings to watch are PCE on Nov. 25, jobs on Dec. 4, and the tone of the Fed before its blackout.

Mentioned in this article

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