With the April 29 Federal Open Market Committee meeting approaching, interest-rate markets are showing an unusually strong consensus: the Federal Reserve is expected to leave policy unchanged. According to CME FedWatch, the probability that the Fed keeps its target range at 3.50% to 3.75% stands at 99%. The remaining 1% reflects a slim chance of a 25-basis-point hike, while the odds of a rate cut are effectively 0%.
Markets are firmly aligned on a hold
This view has held steady for at least a week. A month ago, traders were less certain, assigning a 6.2% probability to a rate increase as some participants hedged against stronger-than-expected economic data. That concern has since faded, and pricing now points overwhelmingly to a wait-and-see stance from the central bank.
Prediction markets are telling a similar story. On Polymarket, contracts tied to the June 16–17 FOMC meeting show a 93% chance of no change, with a 4.5% probability of a 25-basis-point cut and just 1.6% for a hike. Total volume in that market has exceeded $10.5 million. Notably, the “50+ basis point cut” outcome has attracted more than $2.8 million in volume despite carrying an implied probability of under 1%.
Summer outlook still favors steady policy
For the July 28–29 meeting, Polymarket shows a slightly wider range of expectations but still points to no change as the dominant outcome. Traders assign an 85% chance to rates staying unchanged, a 10% chance to a 25-basis-point cut, a 3.4% chance to a hike, and a 2.4% chance to a larger cut. Since launching on March 19, 2026, that market has recorded about $3.9 million in volume.
Kalshi’s parallel July market is close to the same range. It places the probability of no change at 84%, a 25-basis-point cut at 12%, and a hike at 4%. Trading volume on that contract stands at roughly $79,441.
Inflation and labor data limit the case for cuts
The main reason behind this broad alignment is the current macro backdrop. The report notes that March 2026 CPI rose 3.3% year over year, while the unemployment rate stood at 4.3%. That combination leaves Fed officials with limited justification to move rates in either direction. Inflation remains elevated enough to restrain easing expectations, while labor-market conditions have not weakened enough to force a quick policy pivot.
Looking beyond the next few meetings, longer-dated prediction markets also suggest that investors are tempering expectations for easing in 2026. On Polymarket, the market asking how many Fed cuts will occur in 2026 has generated $20.9 million in volume since September 2025. As of late April, the leading outcome is no cuts at all with a 40% probability, followed by one cut at 28% and two cuts at 16%. Kalshi shows a nearly identical distribution at 39.9%, 27.5%, and 15.8%, respectively, with total volume reaching $3.18 million.
Across futures and prediction markets alike, the dominant assumption is that the Fed will stay on hold through spring and likely into summer. Traders will now watch the upcoming April jobs report and fresh CPI data for any signs that this consensus may begin to shift.