Prediction markets on Kalshi currently assign a 34 percent probability that the Federal Reserve will raise the federal funds rate by more than 25 basis points at its December 2027 meeting, down 29 percentage points in the past 24 hours. The sharp decline reflects a growing divergence between tail-risk positioning and mainstream economist forecasts, which now lean heavily toward rate cuts rather than jumbo hikes in late 2027.
Goldman Sachs Research expects the Fed to hold rates steady through 2026 before delivering two 25-basis-point cuts in June and December 2027, moving the target range to 3.0–3.25 percent. The bank's June 8 note, issued after strong U.S. jobs data, explicitly characterized additional rate hikes as "unlikely" and pushed its rate-cut call out to 2027. A Bloomberg survey of 35 economists published in 2026 echoes that view, with the median forecast calling for reductions beginning in June 2027 and a second cut in December 2027, also targeting the 3.0–3.25 percent range.
J.P. Morgan Global Research projects a single 25-basis-point hike in September 2027 as the next move, with no indication in its base case of larger increases at the December meeting. Meanwhile, CME Group's FedWatch tool has shown rising odds of hikes in late 2026 and early 2027, though those probabilities relate to earlier meetings and do not specifically address December 2027. A May 2026 CNBC report citing FedWatch noted that traders were pricing about a 51 percent chance of a hike at the near-term December meeting and over 71 percent by March, reflecting a shift toward tightening expectations but not distinguishing between standard and jumbo moves.
The Kalshi market's 34 percent pricing can be read as a tail-risk bet against the prevailing economist consensus rather than a reflection of explicit Fed guidance. Historically, the central bank has delivered moves larger than 25 basis points in response to major shocks, including 50- to 75-basis-point changes during periods of acute inflation or financial stress. The market closes on December 8, 2027, at 18:59 UTC, with $40 in volume traded over the past 24 hours.
