Market prices put a 78.9% probability on the Federal Reserve raising its target interest rate range to 4%-4.25% at the Dec. 9 meeting, according to US prediction exchange Kalshi.
That outcome would lift the range by a quarter of a percentage point from its current level. The same range also carried the highest probability for the following meeting on Jan. 27, 2027.
Kalshi is a US exchange regulated by the Commodity Futures Trading Commission. The quotes came from a live feed at 16:01:46 UTC on Nov. 4, with December contract volume of about 2.8 million.
These are market prices, not a forecast or a survey. The probabilities describe the prices attached to possible rate outcomes at the time the quotes were taken.
The current federal funds target range, the Fed's benchmark for overnight interest rates, was 3.75%-4% as of Nov. 3, the Federal Reserve Bank of New York said.
For December, Kalshi priced an 18.1% probability that the target range would stay at 3.75%-4%. A higher range of 4.25%-4.5% carried a 1.5% probability.
The two lower December bands carried smaller probabilities: 1% for 3.5%-3.75% and 0.5% for 3.25%-3.5%. Those complete the five target ranges in the December distribution.
For January, Kalshi prices assigned a 59.7% probability to 4%-4.25% and 21.4% to 4.25%-4.5%. The probability of the target range matching its current 3.75%-4% level was 14.8%.
The remaining January probabilities were 1.9% for 4.5%-4.75%, 1.6% for 3.5%-3.75% and 0.5% for 3.25%-3.5%. The two most likely January bands were both above the current target range.
Kalshi's implied expected upper limit of the target range was 4.20% for December and 4.26% for January. Those figures refer to the top of the range, rather than its midpoint.
Each meeting's market prices five possible decisions: a half-point cut, a quarter-point cut, no change, a quarter-point increase or a half-point increase. The distributions combine those probabilities from the current range through successive meetings.
For March 17, 2027, Kalshi prices put 4.25%-4.5% first at 37.1%, followed by 4%-4.25% at 35.3%. The implied expected upper limit rose to 4.36% for that meeting.
The March distribution assigned 11.6% to 4.5%-4.75% and 11.4% to the current 3.75%-4% range. It assigned 2.7% to 3.5%-3.75%, 1.3% to 4.75%-5%, 0.5% to 3.25%-3.5% and 0.1% to 3%-3.25%.
