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Polymarket odds of December Fed rate hike surge after hotter-than-expected US CPI

Betting odds on prediction platform Polymarket for a Federal Reserve interest rate hike in December jumped after US consumer price index data topped forecasts.

Polymarket chart displaying odds for the Fed December decision, showing a 25 basis point increase rising to 87%.
Image: @Cointelegraph

Traders on Polymarket sharply increased their bets on a Federal Reserve rate hike at the December meeting after US consumer price index data came in above expectations, according to Cointelegraph. Odds for a 25 basis point increase climbed to 87% on the platform's December Fed decision contract, while the implied probability of no policy change dropped to 3.6%.[3]

Market observers reported that pricing rapidly shifted from whether the central bank would hike to how aggressive the move might be. The Kobeissi Letter noted that expectations for a 50 basis point hike surged to about 11%, while odds of a 25 basis point hike stood at 84%. An accompanying Polymarket chart showed the probability of a 50-plus basis point hike jumping to 10.5% immediately after the inflation release, as total trading volume on the market surpassed $23.7 million.[2]

Financial outlets Watcher.Guru and BlockNews also reported that the Federal Reserve is projected to raise interest rates by 25 basis points at its next Federal Open Market Committee meeting. According to Polymarket data, odds of a 25 basis point rate cut stood at less than 1%.[1][3][4]

Key facts

  • Polymarket odds for a 25 basis point Federal Reserve rate hike in December climbed to 87% following higher-than-expected US CPI data, according to Cointelegraph.
  • Polymarket's December Fed decision market showed a 7.1% probability of a 50-plus basis point hike, 3.6% odds of no change, and less than 1% odds of a 25 basis point decrease.
  • The Kobeissi Letter reported that expectations for a 50 basis point hike reached 11% while 25 basis point hike odds stood at 84%, with Polymarket data showing a 10.5% probability for a 50-plus basis point hike after the CPI release.
  • Trading volume on Polymarket's December Fed decision contract reached roughly $23.8 million.
  • Watcher.Guru and BlockNews reported that the Federal Reserve is projected to raise rates by 25 basis points at its next FOMC meeting.

Sources 路 4 sources

  1. WG

    Watcher.Guru@WatcherGuruPost on X 路

    JUST IN: 馃嚭馃嚫 Federal Reserve projected to raise interest rates by 25 basis points at the next FOMC meeting. https://t.co/gjhIs1DeZ5

    Open source
  2. TK

    The Kobeissi Letter@KobeissiLetterPost on X 路

    Rate hike expectations are soaring. In a sudden turn of events, markets are now pricing in the possibility of a 50 basis point rate hike in December. Market expectations for a 50 basis point hike have surged to 11%, while expectations for a 25 basis point hike stand at 84%. It is no longer a matter of if the Fed will hike rates in December, but rather by how much.

    Open source
  3. CO

    Cointelegraph@CointelegraphPost on X 路

    馃嚭馃嚫 NEW: Polymarket odds of a 25 bps Fed rate hike in December climb to 87% after US CPI comes in above expectations. https://t.co/RZm8qDxh7I

    Open source
  4. BL

    BlockNews@blocknewsdotcomPost on X 路

    馃毃 JUST IN: 馃嚭馃嚫 The Federal Reserve is projected to RAISE interest rates by 25 BASIS POINTS at its next FOMC meeting! https://t.co/7MpgWoDdoD

    Open source