Fed Rate Hike Odds Jump as September Meeting Approaches
The probability of a 25bp rate hike at the September 2026 FOMC meeting rose 5¢ to 27¢, with over 590k volume on the 'Yes' contract. The 'no change' contract sits at 70¢ with 457k volume. Traders are pricing in a hawkish tilt after stronger-than-expected inflation data.
Cross-market probability snapshot
Will the upper bound of the federal funds rate be above 3.75% following the Fed's Sep 16, 2026 meeting?: Above 3.75%
32¢Will the rate of CPI inflation be above 3.2% for the year ending in August 2026?: Above 3.2%
85¢Each row is a contract priced as a YES probability. Bars are tinted emerald in the >50% band, zinc otherwise. Hover or open in /markets for live orderbook data.
Key takeaways
- 01
The probability of a 25bp rate hike at the September 2026 FOMC meeting rose 5¢ to 27¢, with over 590k volume on the 'Yes' contract.
- 02
The 'no change' contract sits at 70¢ with 457k volume.
- 03
Traders are pricing in a hawkish tilt after stronger-than-expected inflation data.
Full analysis
The Federal Reserve's September 2026 meeting is now the focal point for rate expectations. The market for a 25bp hike (KXFEDDECISION-26SEP-) moved from 22¢ to 27¢ on heavy volume of 590,296, while the 'no change' contract (KXFEDDECISION-26SEP- for 0bps) dropped to 70¢ on 457,418 volume. This shift follows the release of CPI data showing core inflation above 3.2% year-over-year (KXCPIYOY-26AUG-T3.2 trades at 90¢). The implied probability of a cut remains negligible at 1¢. Key contracts to watch: KXFEDDECISION-26SEP- for 25bp hike, KXFED-26SEP-T3.75 (upper bound above 3.75% at 29¢), and KXRATECUT (cut before 2027 at 13¢). Traders should monitor upcoming payroll and PCE releases for further confirmation.
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