Kalshi Traders Predict 66% Chance of Another Rate Hike at October Fed Meeting

The Federal Reserve's next interest rate hike is now highly likely according to Kalshi traders.

At its September meeting, the Fed raised rates for the first time in over three years by 25 basis points. Now, traders are pricing another 25-basis-point increase at the October meeting at a 66% probability, up from 50.8% just nine days prior.

Fed Governor Michael Barr reinforced this expectation by stating that further interest-rate increases are likely to be needed to bring inflation back in line with the central bank's 2% target.

Barr emphasized the importance of price stability for achieving maximum employment, aligning with the Fed's dual mandate. S&P Global's September flash PMI data also showed renewed inflationary pressures, with companies' input costs rising at their fastest pace in nearly four years due to increased fuel and transportation costs.