Will the Fed cut rates more than 25 bps in 2026?

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Across venues

· updated 1hPredictPal Consensus

8%blended Yes · 2 venuesMedium reliability

The same question trades on 2 venues — prices range 1%–9%. This blend is weighted by each venue’s market depth.

Across real-money and play-money markets, the collective odds suggest only about an 8% chance of a rate cut larger than

Kalshi

$490K vol9%

Manifold· PlayPlay moneyCheapest Yes

Ɱ1.3K vol1%

Informational only · play-money venues count less in the blend. Tap a venue to compare.

How each venue’s Yes has moved

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AI overview· Updated 2h ago

Despite the Fed's 2025 projection of just one 25 bps cut, the market now sees virtually no chance of a larger cut, as recent broker calls and geopolitical tensions have shifted expectations toward no change or even a hike.

📊 Base rate: Since 2000, the Fed has cut rates by more than 25 bps in a single year only during recessions (2001, 2007-2008, 2020), occurring in about 20% of years, making the current 9% odds low but not extreme.

What's driving it

• Most brokerages now see no Fed policy change in 2026, as reported by Reuters on June 23, 2026, solidifying the no-cut view.
• BofA and Deutsche Bank expect a rate hike in September 2026 (Reuters, Jun 22), pushing odds further toward no cut.
• Middle East conflict driving up energy prices has raised doubts about rate cuts (Reuters, Mar 3), fueling inflation concerns.
• The Fed's own December 2025 projection of only one 25 bps cut for 2026 (Reuters, Dec 10) sets a low baseline for a larger cut.

The case for YES

• If the economy deteriorates sharply, the Fed could cut more aggressively, as it did in 2020 and 2008.
• Brokerages in December 2025 still stuck with rate cut forecasts despite Fed caution (Reuters, Dec 11), suggesting underlying expectations for easing.
• The 2025 global easing push (Reuters, Dec 23) shows central banks are willing to cut significantly when needed.

The case for NO

• Recent broker surveys (Reuters, Jun 23) show no expectation of policy change, let alone a cut over 25 bps.
• Major banks are even forecasting a rate hike (Reuters, Jun 22), which would be the opposite of a cut.
• The Fed's December projection of just one 25 bps cut (Reuters, Dec 10) makes a larger cut unlikely, and subsequent geopolitical inflation risks have reinforced that.

What to watch

• September 2026 FOMC decision: if the Fed holds or hints at tightening, No odds will rise; any surprise cut would boost Yes, but unlikely.
• August 2026 CPI release: higher inflation would decrease Yes odds; lower inflation could slightly increase them.
• Any escalation in Middle East conflict (Reuters, Mar 3) would further reduce Yes odds by increasing energy prices.

Sources

🔗 reuters.com

AI-generated · grounded in recent news + odds · informational only, not advice. Verify on the source platform.

Consensus is a liquidity-weighted blend of each venue’s Yes probability (play-money venues count less). Informational only — PredictPal is not affiliated with any platform and does not facilitate trading.