Fed decisions (Sep–Dec)

According to the latest prediction market data for the query “Fed decisions (Sep–Dec)”, traders have formed a strong consensus.

Currently, Hike–Pause–Hike is dominating the market with an overwhelming 71% chance of winning. Hike–Pause–Pause follows in second place at 28%, while Other sits in third with 2.2%. The betting volume for this specific market has already reached $559.9K, reflecting intense industry interest.

To better assess where each potential outcome stands, the market can be segmented into three distinct trading tiers based on implied probability and contract pricing:

🥇 Tier 1: The Dominant Leader

• Hike–Pause–Hike (71%): Currently commanding the highest probability, Hike–Pause–Hike is heavily favored by the order book. Traders looking to back this outcome face a “Buy Yes” contract price of 71¢, signaling a high degree of market conviction. This contract alone has generated $155.8K in volume.

🥈 Tier 2: The Primary Challengers

• Hike–Pause–Pause (28%): Positioned as the most viable alternative, Hike–Pause–Pause maintains a 28% chance of resolving true. Its “Buy Yes” shares currently trade at 28¢.
• Other (2.2%): Sitting in third place with a 2.2% probability, the market shows measured skepticism toward Other, treating it as an outside wildcard unless momentum shifts.

The FED interest rates are defined in this market by the upper bound of the target federal funds rate. The decisions on the target federal funds rate are made by the Federal Open Market Committee (FOMC) meetings.

This market will resolve according to the decisions made by the next three Federal Open Market Committee (FOMC) meetings: September 15-16; October 27-28; and December 8-9.

A qualifying cut occurs when the new upper bound of the target federal funds rate is lower compared to the level it was prior to the respective meeting.

A qualifying hike occurs when the new upper bound of the target federal funds rate is higher compared to the level it was prior to the respective meeting.

A qualifying pause occurs when the new upper bound of the target federal funds rate is equal to the level it was prior to the respective meeting.

If the Fed publishes a different combination than any listed, this market will resolve to "Other". Any rate cut will be encompassed by "Other".

Emergency rate changes outside the regularly scheduled meetings will not be considered.

The resolution source for this market is the FOMC’s statement after its meetings:

https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm

The level and change of the target federal funds rate is also published at the official website of the Federal Reserve:

https://www.federalreserve.gov/monetarypolicy/openmarket.htm

While human consensus and speculative volume shape the broader prediction market, our quantitative algorithms offer a data-driven counter-perspective. By analyzing fundamental signals, underlying trends and historical distributions, our AI Valuation model calculates an independent “Fair Value” probability for each outcome.

Comparing this Fair Value against the current Trade Value uncovers major disparities — known as the Expected Value (EV) Gap. Contracts with a positive EV Gap represent statistically underpriced outcomes, whereas a negative EV Gap flags a potential market overreaction.

Top AI Alpha & Mispriced Arbitrage Opportunities

Based on the latest data model run, several key contracts stand out with significant deviations:

• The Most Overvalued Outcome Hike–Pause–Pause currently trades at 28%, but our AI places its Fair Value at just 21.1%. This creates a large negative EV Gap of -6.9%, suggesting the crowd may be overhyping this outcome and driving the premium too high.
• The Best Value Play (Highest EV) Our model identifies Hike–Pause–Hike as the premium value opportunity on the board. While the market only assigns it a 71% trading probability, our AI’s Fair Value assessment sits at 71.2% — yielding an impressive +0.2% EV Gap.