Prediction markets price in a 63% probability the Fed keeps rates unchanged in September
AI Market Summary
Prediction markets and FedWatch imply September policy is increasingly skewed toward a hold, reversing late-July hike expectations after softer labor data. A higher perceived probability of stable rates can reduce near-term rates volatility and shift positioning across USD, duration, and risk assets ahead of the September FOMC. The divergence between Polymarket/Kalshi and FedWatch highlights uncertainty around the reaction function into the meeting.
Impact level
● Medium
Affected assets
NCSIDXY2USD/USDT-0.01%
AI Insight · NCSIDXY2USD/USDTAI Insight
● Neutral
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Odaily Planet Daily reports that prediction markets are leaning toward the Federal Reserve leaving interest rates unchanged in September. On Polymarket, the related contract has seen more than $20.3 million in volume, with "63%" pricing for a hold. Kalshi shows a similar read: "65%" odds with trading volume close to $4.9 million.
CME's FedWatch tool puts the probability of the Fed keeping the federal funds rate target range at 3.50% to 3.75% on September 16 at 55.6%, versus 44.4% for a 25-basis-point increase. As of July 31, FedWatch was pricing a 67% chance of a rate hike.
Fresh labor data may be influencing expectations. Figures released by the U.S. Bureau of Labor Statistics on August 7 showed nonfarm payrolls fell by 23,000 in July, while the unemployment rate stood at 4.1%. The Fed kept rates unchanged at its July 28'29 meeting, and its next policy meeting is scheduled for September 15'16.
