Will 2 Fed rate cuts happen in 2026?

The market is pricing in only a 16% probability of two or more Fed rate cuts in 2026, down sharply from 23¢ a week ago, suggesting recent economic data or Fed communications have shifted expectations toward a higher-rate environment. The extreme 743% implied yield on the "Yes" side reflects the deeply out-of-the-money pricing, though this must be tempered by the modest $1,877.87 daily volume and $116,726 open interest, indicating relatively thin liquidity for a binary outcome. With 258 days to expiry and a neutral regime score, the market appears to be pricing in either sustained inflation concerns or a resilient economy that forestalls aggressive easing, though the sharp recent move warrants monitoring for potential mean reversion or new Fed guidance.

Resolution rules

This market will resolve according to the exact amount of cuts of 25 basis points in 2026 by the Fed (including any cuts made during the December meeting). Emergency rate cuts outside of scheduled FOMC meetings will also count toward the total number of cuts in 2026. This market will remain open until December 31, 2026, 11:59 PM ET, to account for any such emergency actions. For example, if the Fed cuts rates by 50 bps after a meeting, it would be considered 2 cuts (of 25 bps each). This market will resolve early to "No" if the specified number of cuts becomes impossible — i.e., if more cuts have already occurred than the strike in question. Note that cuts between 1–24 bps (inclusive) will also be considered 1 rate cut. The resolution source for this market will be FOMC statements after meetings scheduled in 2026 according to the official calendar: https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm. The level and change of the target federal funds rate is also published at the official website of the Federal Reserve at https://www.federalreserve.gov/monetarypolicy/openmarket.htm.

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Regime

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