Predicted Fed rate under each Fed Chair

According to the latest prediction market data for the query “Predicted Fed rate under each Fed Chair”, traders have formed a strong consensus.

Currently, Kevin Warsh & Rate > 2.5% is dominating the market with an overwhelming 88.5% chance of winning. Kevin Warsh & Rate ≤ 2.5% follows in second place at 7.6%. The betting volume for this specific market has already reached $158.8K, 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

• Kevin Warsh & Rate > 2.5% (88.5%): Currently commanding the highest probability, Kevin Warsh & Rate > 2.5% is heavily favored by the order book. Traders looking to back this outcome face a “Buy Yes” contract price of 89¢, signaling a high degree of market conviction. This contract alone has generated $8.1K in volume.

🥈 Tier 2: The Primary Challengers

• Kevin Warsh & Rate ≤ 2.5% (7.6%): Positioned as the most viable alternative, Kevin Warsh & Rate ≤ 2.5% maintains a 7.6% chance of resolving true. Its “Buy Yes” shares currently trade at 8¢.

This market will resolve according to the combined outcome of who will be confirmed as the next Fed Chair and whether the Fed’s lower bound will reach 2.5% or lower (https://polymarket.com/event/what-will-fed-rate-hit-before-2027) at any point by December 31, 2026, 11:59 PM ET.

This market will resolve to “Other” if an outcome not listed occurs within the specified timeframe.

This market may resolve as soon as the respective conditions are met.

The rules and resolution criteria are as follows:

1. Who be confirmed as the next Fed Chair?

This market will resolve according to the next individual confirmed by the U.S. Senate to be Chair of the Federal Reserve by December 31, 2026, 11:59 PM ET.

Confirmation is defined as approval by the U.S. Senate, whether by a majority vote or by unanimous consent.

Recess appointments without Senate confirmation will not count toward a "Yes" resolution.

Acting or interim appointments will not count unless the individual is confirmed by the U.S. Senate to be Chair of the Federal Reserve.

The primary resolution source for this market will be official information from the U.S. Senate (see: https://www.senate.gov/legislative/nominations_new.htm); however, a consensus of credible reporting may also be used.

2. Will the Fed’s lower bound reach 2.5% or lower in 2026?

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

This market will resolve according to whether the lower bound of the target federal funds rate reaches 2.5% at any point by December 31, 2026, 12:59 PM ET.

Emergency rate cuts and hikes outside the regularly scheduled meetings will be considered.

The resolution source for this market is the official website of the Federal Reserve at:

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

Note: If the lower bound of the target federal funds rate reaches 2.5% before a new Fed Chair is nominated, it will qualify.

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 Kevin Warsh & Rate > 2.5% currently trades at 88.5%, but our AI places its Fair Value at just 65.1%. This creates a large negative EV Gap of -23.4%, suggesting the crowd may be overhyping this outcome and driving the premium too high.
• The Best Value Play (Highest EV) Our model identifies Kevin Warsh & Rate ≤ 2.5% as the premium value opportunity on the board. While the market only assigns it a 7.6% trading probability, our AI’s Fair Value assessment sits at 14% — yielding an impressive +6.4% EV Gap.