The market price for the Federal Reserve leaving its interest rate target range unchanged at its Oct. 28 meeting put the probability at 91.1%, according to US prediction exchange Kalshi.
The most likely outcome shifts to a higher target range for Dec. 9. The December distribution still gives some weight to unchanged rates, though less than the October market.
Kalshi is a US exchange regulated by the Commodity Futures Trading Commission. Its live-feed quotes were taken at 00:00:08 UTC on Oct. 27, with reported contract volume for the nearest meeting of about 18 million.
These are market prices, not a forecast or a survey. The distributions describe the target range at each meeting, with later outcomes incorporating the possible results of earlier decisions.
The current federal funds target range, the Fed's benchmark band for overnight interest rates, is 3.75%-4%, FRED data showed as of Oct. 26.
For October, Kalshi's distribution assigns 7.4% to a range of 4%-4.25%, the second most likely outcome after an unchanged range. It assigns 0.5% each to 3.25%-3.50%, 3.50%-3.75% and 4.25%-4.50%.
The October market implies an expected upper limit of 4.02%. That figure refers to the top of the target band, rather than its midpoint or the rate at which overnight transactions actually take place.
For December, the distribution puts 66.2% on a 4%-4.25% range and 21.4% on the current 3.75%-4% range. It assigns 9.3% to 4.25%-4.50%.
The remaining December outcomes carry smaller probabilities: 1.8% for 3.50%-3.75%, 0.7% for 4.50%-4.75% and 0.6% for 3.25%-3.50%. The implied expected upper limit is 4.21%.
For Jan. 27, 2027, the largest probability is 49.6% for 4%-4.25%, followed by 27% for 4.25%-4.50%. The current range carries a 15.4% probability.
The January distribution also assigns 4.9% to 4.50%-4.75% and 2% to 3.50%-3.75%. It puts 0.5% each on 3.25%-3.50% and 4.75%-5%, with an implied expected upper limit of 4.29%.
Each meeting's underlying market prices five possible decisions: cuts of half or a quarter percentage point, no change, or increases of a quarter or half percentage point.
The target-band distributions chain those probabilities forward from the current range. A December or January band therefore represents the cumulative result of possible decisions, rather than the size of a rate change at that meeting alone.
