macro

October's Fed Meeting Is a Coin Toss on Prediction Markets

Published September 22, 20262 min read

Line chart of 13-Week T-Bill Yield (proxy for fed-funds path), last 90 days (%) — Prediction markets call October's Fed decision a coin toss: Kalshi prices a hike at 56% versus a hold at 42%, with claims and PCE data set to tip the scale. Illustration: MarketIntelLabs

Prediction markets now price the October Federal Reserve meeting as the closest call of the year. Kalshi puts a roughly 56% chance on a quarter-point hike on Oct 28 against about 42% on a hold, and Polymarket and CME fed-funds futures sit at nearly the same split. That is the market refusing to follow the dot plot all the way.

Key Takeaways Kalshi prices an October hike at ~56%, a hold at ~42%, after the Fed's unanimous Sept 16 hike to 3.75%-4.00%. The September dot plot still shows 16 of 18 officials expecting at least one more hike this year, median year-end rate 4.1%. Two prints decide it: weekly initial claims on Sept 24 and August PCE on Sept 30 (July headline PCE 3.7%, core 3.3%). The c…

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