The market price for a 4.00%-4.25% Federal Reserve interest rate range at the Dec. 9 meeting implied a 65.5% probability, making it the most likely outcome, according to Kalshi.
That range is 25 basis points above the current 3.75%-4.00% target, which carried a 31.5% probability for December. A basis point is one-hundredth of a percentage point.
Kalshi is a US exchange regulated by the Commodity Futures Trading Commission. The live-feed quotes were taken on Nov. 5 at 16:01:46 UTC, with contract volume of about 3 million at the nearest meeting.
These are market prices, not a forecast or a survey. The distributions reflect the cumulative result of chaining each meeting's outcome probabilities forward from the current target range.
The Federal Reserve Bank of New York put the current target range at 3.75%-4.00% as of Nov. 4. The date establishes when that range was current, but does not identify when the Fed last changed it.
For December, the remaining probabilities were 1.5% for a 4.25%-4.50% range, 1% for 3.50%-3.75% and 0.5% for 3.25%-3.50%. The current range ranked second behind the band immediately above it.
Kalshi's implied expected upper bound for December was 4.17%. That figure refers to the top of the target range, rather than its midpoint, and combines the possible outcomes instead of selecting one band.
For the Jan. 27, 2027, meeting, the 4.00%-4.25% range again carried the largest probability, at 55.6%. The current 3.75%-4.00% range followed at 24.5%, while the 4.25%-4.50% range carried 16.4%.
The remaining January probabilities were 1.6% for 3.50%-3.75%, 1.3% for 4.50%-4.75% and 0.5% for 3.25%-3.50%. The implied expected upper bound was 4.22%, compared with December's 4.17%.
By the March 17, 2027, meeting, the two largest probabilities were closer together. The 4.00%-4.25% range carried 37.8%, followed by 35% for 4.25%-4.50%, a gap of 2.8 percentage points.
The current range carried a 13.9% probability for March, while 4.50%-4.75% carried 9.4%. The lower 3.50%-3.75% band carried 2.3%, compared with 0.9% for 4.75%-5.00% and 0.5% for 3.25%-3.50%.
The implied expected upper bound for March was 4.34%. Across the three meetings, 4.00%-4.25% remained the most likely individual band, although its probability declined at each later date.
Each meeting's underlying market prices five possible decisions: a cut of 50 basis points, a cut of 25 basis points, no change, a 25-basis-point increase or a 50-basis-point increase. Chaining those decisions produces the bands shown for later meetings.
