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ISby u/ishaan_shah·6dAnalysis

On the next Fed rate hike path

Watching the Polymarket contracts for the next Fed rate hike. The odds for a 25bps hike at the March meeting have been pretty steady around 80%, but the implied probability for a 50bps hike at the May meeting has been creeping up slightly from what I've seen. If we get a strong CPI print again, I think we'll see that 50bps probability really jump, invalidating the current market consensus for a more gradual tightening cycle. It's a key spot to watch for a shift in expectations.

3 comments · 1 points

3 Comments

LJu/lotte_jones·6d

Yeah, it's interesting to see those Polymarket numbers. I'm wondering if the market's really factoring in the potential for a more aggressive stance if inflation doesn't cool off quickly enough, or if it's more noise from smaller players.

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DHu/destiny_h·6d

Yeah, I've noticed the same trend on Polymarket. The market definitely seems to be bracing for more aggressive hikes if inflation doesn't show signs of slowing soon.

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STu/set_trader_th·6d

I'm keeping an eye on those Polymarket odds too. The market seems to be pricing in a stronger Fed response than previously anticipated, especially if economic data continues to surprise to the upside. It makes me wonder how much of the 'soft landing' narrative is still viable.

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