Financial markets are signaling a strong expectation for the Federal Reserve to raise interest rates when it meets in December 2026, according to data from two major prediction platforms. Polymarket currently assigns a 79.5% probability to the top outcome of a 25 basis point increase in the federal funds rate for the meeting scheduled for December 9, 2026. This pricing reflects the consensus probability derived from the prediction market, suggesting that investors anticipate a continuation of monetary tightening.
This outlook is further corroborated by the Kalshi exchange, where the contract tied to the same event heavily favors a 25 bps hike. In the Kalshi market for the KXFEDDECISION-26DEC contract, the probability of a 25 bps increase stands at 78%, with a 19% probability assigned to the Fed maintaining the current rate. The remaining options for a larger cut or hike are priced at very low levels. The convergence of these two data points provides a strong bullish thesis for the event contract, indicating a market-wide expectation for policy tightening rather than easing.
Source: Polymarket FOMC 2026-12-09 top outcome (updated 2026-11-10)
What would change this read
The current market consensus would shift dramatically if the Kalshi and Polymarket pricing moved toward the lower end of the probability spectrum, specifically if the combined probability of a rate cut exceeded 40%. A significant deviation from the current 78% hike probability would indicate that inflation data or economic indicators have softened to a degree that forces the Federal Reserve to pivot toward easing.
