The Federal Reserve's Oct. 28 decision carried a 92.1% market-priced probability of leaving its interest rate target range unchanged, according to prices from US prediction market Kalshi taken on Oct. 27.
For Dec. 9, the most likely range was 4%-4.25%, a quarter percentage point above the current setting. That outcome carried a 67% probability, compared with 22.3% for the range staying unchanged.
Kalshi is a US exchange regulated by the Commodity Futures Trading Commission. The quotes came from a live feed at 16:00:06 UTC on Oct. 27, and contract volume for the nearest meeting was 18.4 million.
The current federal funds target range was 3.75%-4% as of Oct. 27, FRED, the Federal Reserve Bank of St. Louis database, said.
The probabilities are market prices, not a forecast or a survey. Each meeting's market prices five possible decisions: cuts of 25 or 50 basis points, no change, or increases of 25 or 50 basis points.
A basis point is one hundredth of a percentage point. The rate bands combine those probabilities across successive meetings, starting from the current target range, so later distributions reflect the possible paths of earlier decisions.
For Oct. 28, the 4%-4.25% range carried a 6.4% probability. Three other ranges each carried 0.5%: 3.25%-3.50%, 3.50%-3.75% and 4.25%-4.50%.
The implied expected upper limit of the target range was 4.01% for October. This measure refers to the top of the range, rather than its midpoint, and combines the possible outcomes into one rate.
For December, the 4.25%-4.50% range carried a 7.8% probability, followed by 1.8% for 3.50%-3.75%. The 3.25%-3.50% and 4.50%-4.75% ranges each carried 0.6%.
The implied expected upper limit rose to 4.20% for December. The most likely band therefore shifted above the current setting between the October and December meetings, while the probability of the current range fell.
For Jan. 27, 2027, the 4%-4.25% range remained the most likely outcome, at 50%. The next largest probability was 26.3% for 4.25%-4.50%, followed by 15.9% for the current 3.75%-4% range.
The January distribution assigned 4.8% to 4.50%-4.75% and 2% to 3.50%-3.75%. It assigned 0.5% to 3.25%-3.50% and 0.4% to 4.75%-5%.
The implied expected upper limit reached 4.29% for January, the highest of the three meetings. All three distributions reflect the same Oct. 27 snapshot of market prices.
