Market prices put a 91.1% probability on the Federal Reserve keeping its interest rate target unchanged at its Oct. 28 meeting, according to US prediction market operator Kalshi.
For Dec. 9, the largest probability shifts to a target range a quarter percentage point higher. The probability of retaining today's range falls to 21.4%.
Kalshi is a US exchange regulated by the Commodity Futures Trading Commission. Its live-feed quotes were taken at 16:00 UTC on Oct. 22, with contract volume for the nearest meeting at 14.1 million.
The current federal funds target range is 3.75%-4%, according to Federal Reserve Economic Data, or FRED, as of Oct. 22.
The federal funds rate is the interest rate banks charge each other for overnight loans. The probabilities here are market prices, not a forecast or a survey.
For Oct. 28, Kalshi's distribution assigns 7.4% to a target range of 4%-4.25%, the second-largest probability after an unchanged range. That would put both ends a quarter percentage point above their current levels.
The remaining October bands each carry a probability of 0.5%: 3.25%-3.5%, 3.5%-3.75% and 4.25%-4.5%. Two of those ranges are below the current target and one is above it.
The implied expected upper limit of the October target range is 4.02%. That measure weights the possible upper limits by their probabilities, rather than identifying the single outcome with the largest price.
For Dec. 9, the 4%-4.25% range carries a 66.2% probability, followed by today's range and then 4.25%-4.5% at 9.3%. The distribution assigns 1.8% to 3.5%-3.75%, 0.7% to 4.5%-4.75% and 0.6% to 3.25%-3.5%.
The implied expected upper limit for December is 4.21%. The largest probability therefore sits above the current range even though an unchanged range remains among the possible outcomes.
For Jan. 27, 2027, the largest probability is again attached to 4%-4.25%, at 47.1%. The next-largest shares are 29.6% for 4.25%-4.5% and 15.3% for the current range.
The other January probabilities are 4.8% for 4.5%-4.75%, 2.3% for 3.5%-3.75%, 0.5% for 3.25%-3.5% and 0.4% for 4.75%-5%. January's implied expected upper limit is 4.30%.
Each meeting's market prices five choices: cuts of half or a quarter percentage point, no change, or increases of a quarter or half point. The target-range distributions chain those probabilities forward from today's range, so later meetings incorporate the possible results of earlier decisions.
