Iran war nears end as Waller raises prospect of 50-bps December hike

What happened

President Donald Trump told reporters on Monday that the Iran war was "militarily effectively over," speaking at the White House after a meeting with Qatar's prime minister. He said negotiations were moving in a positive direction and that an agreement could bring the conflict to an end fairly soon, while adding that US forces remained ready to respond if circumstances changed. Brent crude fell 5.85% overnight and slipped another 1.7% to around $90.99 a barrel, Cryptonews.com reported.

On monetary policy, Federal Reserve Governor Christopher Waller said the central bank could consider a 50-basis-point increase in December if October inflation data showed persistent pressure in core prices. He warned that delivering only a quarter-point increase could undermine the Fed's credibility if core inflation remained stubbornly high, while indicating he currently leans toward a smaller step if inflation improves.

Traders moved quickly. According to a Nov. 10 CME FedWatch snapshot cited by Barron's and reported by CryptoSlate, the probability of a half-point December hike rose from 0% to 13.6%, while the odds of a quarter-point move climbed from 84% to 86.4%. The no-change probability fell from 16% to 0%, and the weighted expected move increased from 21.0 basis points to 28.4 basis points. A quarter-point increase remains the dominant expectation.

Bitcoin fell to an intraday low below $73,000 as the inflation figures landed. Separately, Kalshi traders raised the odds of a US Treasury Bitcoin purchase this year to 13%, a market Cryptonews.com said reflects speculation that Washington could move beyond its existing reserve framework and acquire additional BTC.

Why it matters

The developments pull Bitcoin's macro backdrop in opposite directions. Cheaper oil could ease inflation pressure and give the Fed more room to loosen policy later, since energy prices feed into inflation expectations, monetary policy and market liquidity. A larger hike, or a signal that rates stay higher for longer, would tighten financial conditions and make speculative assets less attractive relative to cash and yield-bearing holdings.

Waller's remarks may matter less for the size of the December step than for what they suggest about the Fed's priorities. A half-point move would amount to two standard quarter-point increases delivered at once and would show policymakers placing inflation control ahead of easier financial conditions. For Bitcoin, the risk is not only December's hike size but a shift toward a longer period of elevated rates, which could pressure prices even if the Fed opts for 25 basis points.

What the data shows

October headline CPI rose 0.4% month over month against a 0.3% forecast, and core, which excludes food and energy, rose 0.3% against 0.2%, according to the Nov. 10 release. The headline slowed from 0.6% in September while core held at 0.3% for a third month, with transportation services up 0.8%. The BLS omitted an annual October comparison because the 2025 government shutdown disrupted data collection; at a constant 0.3% monthly pace, core compounds to roughly 3.7% annualized, a run-rate calculation rather than an official annual figure.

Cross-market moves on Nov. 10 showed the pressure. The two-year Treasury yield rose about 19 basis points to 4.74%, the 10-year neared 4.99%, the dollar index gained 0.6% and gold fell more than 2%. Farside Investors data cited by CryptoSlate showed about $1.5 billion in net outflows from US spot Bitcoin ETFs between Nov. 2 and Nov. 9.

Glassnode's Nov. 4 report found about 38% of short-term holder supply in profit, with much of the leverage built since August cleared and spot volume running around 1.5 times its pre-rally level. The firm modeled a long-liquidation band at $73,000 to $76,000 and a concentration of modeled liquidations at $60,000 to $63,000. Those are estimated levels where leveraged positions could be forced to close, not confirmed support or a price forecast.

Background

The Fed held rates at 3.75% to 4% on Oct. 28 by a 10-2 vote, with both dissenters favoring a quarter-point increase. A Reuters poll of 101 economists conducted Nov. 6 to 10 expected 25 basis points in December, taking the range to 4.00%-4.25%; 56 of those respondents saw December as the final hike, while 45 expected at least two further increases in total, including December.

Before Trump's statement, the conflict had already weighed on energy markets, with higher fuel prices adding to inflation concerns and complicating the Fed's effort to return price growth toward its 2% target. An end to the war would remove one source of energy-market uncertainty, though the Fed's inflation problem would not disappear with it.

What is still unclear

Waller's threshold opens consideration of a 50-basis-point move, but committee backing is a separate question, and several voting members would need to publicly support faster tightening. Trump also has not ruled out further strikes, leaving some uncertainty around negotiations, and the Kalshi market on a Treasury Bitcoin purchase remains speculation rather than announced policy.

What to watch

PPI arrives Nov. 13, the minutes of the October meeting Nov. 18, October core PCE Nov. 25 and the Fed's communications blackout begins Nov. 28. The December jobs report is due Dec. 4, the rate decision comes Dec. 9, and November CPI lands Dec. 10, a day after the Fed votes, meaning officials decide before the next inflation print. Softer PCE or hiring data could weaken the case for a half-point increase.

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