Will the Federal Reserve hike rates by December 31, 2026?
🗂 Part of event: Next Fed rate hike? →💡 What the odds say
The market puts this at about a 67% chance — likely.
No money — just record your call and see if you were right. Yes is at 67% right now.
The market has swung from a coin-flip to a clear 69% probability of a rate hike, driven by a sudden wave of hawkish Fed commentary and expert warnings that the central bank may need to reverse its earlier cuts to combat resurgent inflation.
What's driving it
- • Fed officials publicly fretting over inflation risk and weighing rate hikes (Reuters, Jul 10) directly boosted the Yes case.
- • A MarketWatch expert cautioned that the Fed may need to undo rate cuts that stabilized the economy (MarketWatch, Jul 10), adding weight to a hike.
- • Trump's statement that he will defer to Fed Chairman Kevin Warsh on a rate hike before the midterms (Washington Examiner, Jul 10) removed a key political obstacle.
- • The odds jumped from roughly 50% on July 9 (CNBC) to 69% by July 26, reflecting the cumulative impact of these hawkish signals.
The case for YES
- • Persistent inflation above the Fed's target could force a hike, as officials are already fretting over inflation risk (Reuters).
- • The Fed may need to reverse its earlier rate cuts to prevent the economy from overheating, as experts warn (MarketWatch).
- • Political cover from Trump deferring to Warsh reduces the risk of White House pressure against a hike (Washington Examiner).
The case for NO
- • The Fed remains split on policy (CNBC), and internal disagreement could stall any move to hike.
- • Consumers are already piling on credit card debt amid rising prices and looming hikes (Investopedia), suggesting economic fragility that the Fed may avoid worsening.
- • The Fed might prioritize stability ahead of the midterm elections, even with Trump's deference, to avoid a politically unpopular rate increase.
What to watch
- • Upcoming FOMC meetings (September, November, December 2026): hawkish statements from members would push odds up; dovish statements would push them down.
- • Release of CPI or PCE inflation data in the coming months: higher-than-expected readings would increase the probability of a hike; lower readings would decrease it.
- • Midterm elections in November 2026: as the election approaches, the Fed may become more cautious, potentially lowering the odds of a hike.
AI-generated · grounded in recent news + odds · informational only, not advice. Verify on the source platform.
Data from Kalshi’s public API, for informational purposes only. PredictPal is not affiliated with any platform and does not facilitate trading.
Discussion
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How it resolves
Settled by Kalshi, a CFTC-regulated US exchange, against the official source named in each contract (e.g. a government release or election certification), with an Outcome Review Committee as a backstop for disputes.
Resolution criteria
If the Federal Reserve hikes again by Dec 31, 2026, then the market resolves to Yes.
ⓘ A market settles under its own written rules, which can lag what looks decided in the news — so the price may not move to 100% the moment an outcome seems obvious.
View the official rules on Kalshi ↗Related markets
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