Market prices put a 67.8% probability on the Federal Reserve raising its target range to 4%-4.25% at its Dec. 9 meeting, according to Kalshi quotes taken on Oct. 31.
That range is 25 basis points, or a quarter percentage point, above the current setting. The December distribution put the probability of the current range remaining in place at 28.8%.
Kalshi is a US prediction exchange regulated by the Commodity Futures Trading Commission. The live-feed quotes were taken at 16:01:47 UTC on Oct. 31, and the exchange reported December contract volume of about 2.47 million.
These are market prices, not a forecast or a survey. The distributions combine successive meetings' probabilities to calculate where the target range could stand at each meeting.
The Federal Reserve Bank of New York put the current federal funds target range, the central bank's benchmark interest-rate setting, at 3.75%-4% as of Oct. 29.
For December, Kalshi's distribution assigned 2.4% to a 4.25%-4.5% range. It assigned 0.5% each to 3.25%-3.5% and 3.5%-3.75%, completing the five possible bands for that meeting.
The implied expected upper limit of the December target range was 4.18%. That figure is a probability-weighted average across the possible outcomes, rather than the upper limit of the single most likely band.
For the Jan. 27, 2027, meeting, the distribution put 55.2% on a 4%-4.25% range. The probability of the current 3.75%-4% range was 21.5%, while a 4.25%-4.5% range carried 19.6%.
The remaining January probabilities were 2% for 4.5%-4.75%, 1.2% for 3.5%-3.75% and 0.5% for 3.25%-3.5%. The implied expected upper limit was 4.25%, compared with December's 4.18%.
By the March 17, 2027, meeting, the two largest probabilities were closer together. A 4%-4.25% range carried 36.3%, followed by 35% for 4.25%-4.5%.
The March distribution put 13.4% on the current 3.75%-4% range and 10.8% on 4.5%-4.75%. It assigned 2.6% to 3.5%-3.75% and 1.2% to 4.75%-5%.
The remaining March bands carried 0.6% for 3.25%-3.5% and 0.1% for 5%-5.25%. The implied expected upper limit reached 4.35%, above the corresponding figures for December and January.
Each meeting's market prices five decisions: cuts of 50 or 25 basis points, no change, or increases of 25 or 50 basis points. Chaining those probabilities from the current range produces the wider set of possible bands at later meetings.
