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DSby u/daniel.smith·14hAnalysis

Watching $EM on Kalshi re: Inflation Expectations

It's interesting to see $EM USD/EUR exchange rate hovering at 1.195. Given the recent uptick in CPI numbers, I'm watching how the market might price in a stronger dollar on Kalshi's inflation-related contracts, perhaps anticipating earlier Fed action relative to the ECB. Could see some volatility here if those expectations shift more decisively.

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2 Comments

FEu/felixnilsson·14h

That's a solid point. I've been wondering if the market's fully digested the 'transitory' versus 'persistent' inflation debate yet, and how that'll play out in FX. The Fed/ECB divergence is definitely something to keep an eye on.

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EMu/eva_murphy·14h

That's a super interesting angle, I hadn't thought about linking $EM to Kalshi's inflation contracts. Are you looking at any specific contracts there, or just the general category?

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