Market prices put a 70.3% probability on the Federal Reserve raising its target interest rate range to 4%-4.25% at its Dec. 9 meeting, according to US prediction exchange Kalshi.
That would put the range a quarter percentage point above the current 3.75%-4%, which the Federal Reserve Bank of New York listed as of Oct. 29.
Kalshi is a US exchange regulated by the Commodity Futures Trading Commission. Its live-feed quotes were taken at 13:01:48 UTC on Oct. 30, with contract volume for the December meeting at about 2.3 million.
These are market prices, not a forecast or a survey. Each meeting's market prices five possible decisions, and the target-range probabilities come from chaining those prices forward from the current range.
For December, the probability of keeping the current 3.75%-4% range was 26.2%. The probability of a 4.25%-4.50% range was 2.5%, while the 3.25%-3.50% and 3.50%-3.75% ranges each carried a 0.5% probability.
The implied expected upper bound of the December target range was 4.18%. That figure refers to the top of the range, rather than the effective federal funds rate, which the New York Fed figures put at 3.88%.
For the Jan. 27, 2027, meeting, the 4%-4.25% range remained the most likely outcome, with a 56% probability. The 4.25%-4.50% range carried a 20.1% probability, followed by 20% for the current 3.75%-4% range.
The January distribution also assigned a 2% probability to 4.50%-4.75%, 1.3% to 3.50%-3.75%, and 0.5% to 3.25%-3.50%. The implied expected upper bound for that meeting was 4.25%, compared with December's 4.18%.
By the March 17, 2027, meeting, the two most likely ranges were more closely matched. The 4%-4.25% range carried a 35.9% probability, while 4.25%-4.50% carried 35.4%.
The March prices assigned a 12.8% probability to the current 3.75%-4% range and 11.2% to 4.50%-4.75%. The implied expected upper bound rose to 4.36% for that meeting.
The remaining March probabilities were 2.6% for 3.50%-3.75%, 1.3% for 4.75%-5%, 0.6% for 3.25%-3.50%, and 0.1% for 5%-5.25%.
The five decisions priced at each meeting are cuts of half or a quarter percentage point, no change, and increases of a quarter or half percentage point. Chaining them across successive meetings produces a wider set of possible target ranges for January and March than for December.
