Will the Fed’s lower bound reach 3.0% or lower before 2027?

The market leans towards the Fed's lower bound staying above 3.0% before 2027.

Current market probabilities indicate a 60.5% chance that the Fed's lower bound will not reach 3.0% or lower before 2027. The Pulse AI also reflects a similar sentiment, with a slightly higher probability for a 'NO' outcome at 57%. Overall, the market appears fairly priced with moderate confidence.

• 1 Current market sentiment favors a stable or rising interest rate environment.
• 2 Economic indicators suggest limited likelihood of aggressive rate cuts.
• 3 Historical trends show Fed rates rarely drop below 3% in stable conditions.
• 4 Market liquidity appears adequate for current trading activity.
• 5 Time pressure is moderate with over 6638 hours until expiry.

The FED interest rates are defined in this market by the lower or the upper bound of the target federal funds range. The decisions on the target federal fund range are made by the Federal Open Market Committee (FOMC) meetings.

This market will resolve to “Yes” if the lower or the upper bound of the target federal funds rate reaches the specified level at any point by December 31, 2026, 12:59 PM ET. Otherwise, this market will resolve to “No.”

Emergency rate cuts and hikes outside the regularly scheduled meetings will be considered.

The resolution source for this market is the official website of the Federal Reserve at:
https://www.federalreserve.gov/monetarypolicy/openmarket.htm.

This market may resolve as soon as the relevant data showing the reached level is published.