Fed December hike odds ease to 74% on Kalshi as Q3 ECI cools wage pressure

The December Federal Reserve hike is getting cheaper in the event market, and the force behind the move is not the headline number in today's cost report but the one buried two lines down. Kalshi's contract that pays if the upper bound of the fed funds rate sits above 4.00 percent after the December 9 meeting last traded at 0.74, down from 0.79 at the prior close, after the Bureau of Labor Statistics released the Q3 Employment Cost Index at 8:30 a.m. ET. The headline ECI rose 0.8 percent in the quarter, but event odds traders priced that as cooling, not heating, because the wage line underneath did the easing.

Key takeaways Kalshi's December Fed contract for an upper bound above 4.00 percent…