Market prices put a 92% probability on the Federal Reserve holding its interest rate target at 3.75%-4% at the Oct. 28 meeting, according to US prediction exchange Kalshi.
The most likely outcome for Dec. 9 is a target range a quarter percentage point above that level. That band carries a 67.9% probability, compared with 20.3% for the current range.
Kalshi is a US exchange regulated by the Commodity Futures Trading Commission. The quotes came from its live feed at 20:30:09 UTC on Oct. 24, with contract volume of 15.2 million for the nearest meeting.
These are market prices, not a forecast or a survey. The percentages describe the distribution of priced outcomes for each meeting, rather than a commitment by the central bank to any particular decision.
The current federal funds target range was 3.75%-4% as of Oct. 24, according to data from the Federal Reserve Bank of St. Louis's FRED economic database.
For Oct. 28, the next-largest probability is 6.5% for a 4%-4.25% range. The remaining three bands each carry 0.5%: 3.25%-3.5%, 3.5%-3.75% and 4.25%-4.5%.
The implied expected upper bound of the October target range is 4.01%. This is the probability-weighted average of the possible upper limits, rather than a separate target band available among the listed outcomes.
For Dec. 9, the 4.25%-4.5% band carries an 8.7% probability, behind the higher-priced 4%-4.25% and current-range outcomes. The distribution also assigns 1.8% to 3.5%-3.75%, and 0.6% each to 3.25%-3.5% and 4.5%-4.75%.
The implied expected upper bound for December is 4.21%. Unlike the October distribution, December puts the largest share of probability on a range above the current target.
For Jan. 27, 2027, the largest probability is 50.3% for 4%-4.25%, followed by 27.1% for 4.25%-4.5%. The current 3.75%-4% range carries 14.8%.
The other January outcomes carry 4.8% for 4.5%-4.75%, 2% for 3.5%-3.75%, 0.5% for 3.25%-3.5% and 0.4% for 4.75%-5%. January's implied expected upper bound is 4.29%.
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 listed bands result from chaining those probabilities forward from the current range.
Later meetings therefore include the accumulated effects of possible earlier decisions. Their bands describe where the target range could stand after those meetings, rather than the size of a single meeting's rate change.
