September rate cut priced at 1%, hike at 24% on $35M prediction market book

The Federal Reserve is not cutting rates in September. At least, that is what a $35 million prediction market book is screaming right now. Polymarket odds for the September 15-16 Federal Open Market Committee meeting show just a 1.3% chance of a 25 basis point rate cut, while a rate hike carries a 24% probability. That leaves roughly 70-74% of the market’s money on a simple hold. What the numbers actually say The hike probability is the more interesting number. At 24%, traders are not calling a hike the base case, but they are not ignoring it either. The Fed held rates at its July 29, 2026 meeting, and the data since then has been enough to keep traders cautious without tipping them decisively toward tightening. Inflation and labor market figures remain the two pressure points the market is watching most closely. The trading volume behind these odds matters too. A $35-37 million book on a single FOMC meeting outcome is a meaningful signal. CME FedWatch, which derives its probabilities from interest rate futures rather than prediction markets, is showing a similar picture. Why traders are this nervous about a hike A 24% hike probability at the September meeting would have looked out...