93% — Will the Federal Reserve hike rates by December 31, 2027
Leader: Before 2029 at 93% · Kalshi 93% · 5 contracts · $898 volume · medium confidence
Updated 2026-09-20 16:12:54 UTC

Tracks the leading outcome in a winner-take-all prediction market set with 5 outcomes.

Why this matters:
This market reflects a 92% probability that the Federal Reserve will raise interest rates at some point before the end of 2027. The pricing across the contract ladder suggests traders expect rate increases to occur relatively soon, with near-term contracts (by end of 2026) priced at 81¢, indicating meaningful near-term hike expectations despite recent rate cuts. The primary drivers are the inflation trajectory, labor market data, and Fed communications about policy direction. The December 2027 contract at 89¢ reflects increasing certainty as the timeframe extends, suggesting traders see rate hikes as highly probable within this window. The December 2026 contract pricing—most liquid at $4.2M volume—will be a critical test; if the Fed does not hike by then, the entire probability structure would likely shift lower. Key economic releases, Fed meeting decisions, and employment reports through late 2026 and 2027 will be the primary drivers of price movement.

Key factors:
- Current Fed policy stance: the overnight rate sits between 4.25-4.5%, following recent cuts; any hike would reverse this easing cycle
- Inflation data trajectory: if core PCE remains above 2.5% or re-accelerates, probability of hikes increases; disinflation below 2% would reduce likelihood
- The December 2026 contract (81¢) implies roughly 1-in-5 odds of zero hikes in the next 15 months, representing the near-term resolution point with highest trading volume ($4.2M daily)
- Rate path expectations: market pricing suggests traders expect rate increases more likely in 2027 than 2026, evident from the step-up from 81¢ to 89¢ across the contract ladder
- Labor market stability: unemployment rate changes and wage growth data will influence Fed calculations; significant labor weakness would reduce hike probability

Contracts:
- Will the Federal Reserve hike rates by December 31, 2028?: Before 2029 — 93¢ Kalshi $0 (weight 0%)
- Will the Federal Reserve hike rates by June 30, 2028?: Before July 2028 — 92¢ Kalshi $0 (weight 0%)
- Will the Federal Reserve hike rates by December 31, 2027?: Before 2028 — 91¢ Kalshi $11 (weight 1%)
- Will the Federal Reserve hike rates by June 30, 2027?: Before July 2027 — 90¢ Kalshi $5 (weight 1%)
- Will the Federal Reserve hike rates by December 31, 2026?: Before 2027 — 85¢ Kalshi $882 (weight 98%)

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## Methodology

SimpleFunctions aggregates live YES-side prices from Kalshi and Polymarket contracts bound to this question. For binary topics the headline is the liquidity-weighted mid-price (weight = log(1 + 24h volume) × freshness, where freshness is 1.0 if updated <24h, 0.7 if <7d, 0.4 otherwise). For multi-outcome (winner-take-all) topics the headline is the current leader's price — disjoint outcomes are never arithmetically averaged. Snapshots refresh every 5 minutes during market hours.

## SF Signal

- SF Index, regime, and 30d Brier calibration are computed separately and surfaced at https://simplefunctions.dev/admin/calibration.
- No SimpleFunctions index / regime / calibration signal is bound to this topic yet — the headline above is market-derived only.

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*Last verified: 2026-09-20T15:20:52.085Z*

By SimpleFunctions — https://simplefunctions.dev/

Cite as: "93% per prediction markets (SimpleFunctions, September 2026)"
Canonical: https://simplefunctions.dev/answer/fedhike-2
Full data: https://simplefunctions.dev/api/public/query?q=Will%20the%20Federal%20Reserve%20hike%20rates%20by%20December%2031%2C%202027
Provider: SimpleFunctions — https://simplefunctions.dev