The probability of a Federal Reserve rate hike at the October meeting has fallen to 17% from 28% following nonfarm payroll data that reinforced signs of cooling momentum in the U.S. labor market. According to the CME FedWatch Tool, traders now assign an 83% likelihood that the Fed will hold rates steady, up from 72% prior to the jobs report. Rate expectations have also moderated, with federal funds futures pricing in approximately 22.2 basis points of cumulative tightening through the end of 2026, down from 25.5 basis points before the employment data was released. The shift reflects growing market confidence that labor market softening will limit further monetary tightening.