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What will the Fed rate be at the end of 2026?

What will the Fed rate be at the end of 2026? Where the market stands, how it has moved and how this market resolves.

4.25% 68% Market-implied probability up 3 pts

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Editorial analysis

The Sweat's View

The leader here is consistent with what the Fed itself has published: a September increase, a median projection for one more by year end, and minutes that say the same. Only two meetings remain, so this market is really about whether the committee follows its own projections or the weaker September jobs data. A hold keeps the rate at 4.0%, while a faster pace would lift the outcome in the 4.5% and above bucket.

Market Split

67%
  • 4.25%67%
  • 4.0%18%
  • All others15%

Each option is priced on its own, so shares are scaled to add up to 100%.

The Market in Brief

4.25% leads at 68%, followed by 4.0% at 18% and ≥ 4.5% at 10%. 15 outcomes are listed in total. The market has 6.9M in volume. It is expected to resolve on December 31, 2026.

The Case For

  • The 4.25% outcome, the market's leader, matches one more quarter-point increase from today's 3-3/4 to 4 percent range. The Fed's September projections put the median end-2026 rate at 4.1% (the midpoint), and 12 of 18 participants sat at that level. Federal Reserve, Summary of Economic Projections
  • The minutes of the September 15 to 16 meeting say most participants expected another increase to be appropriate by year end. They released on October 7. Scotsman Guide

The Case Against

  • Hiring slowed sharply. Employers added 29,000 jobs in September against forecasts above 80,000, and the two prior months were revised down by a combined 60,000. Scotsman Guide
  • The projections were not unanimous. Two of 18 participants projected no further change this year and four projected a higher path, so the range of views runs from a hold to two more increases. Federal Reserve, Summary of Economic Projections

What to Watch

  • The October FOMC decision October 27, 2026 The meeting runs October 27 and 28 and has no new projections. Source
  • The December FOMC decision December 8, 2026 The December 8 and 9 meeting is the last of the year and comes with a new set of projections. Source
  • The November and December jobs reports November 5, 2026 The Bureau of Labor Statistics releases October data on November 6 and November data on December 4. Source

Current Probability

4.25%

68%

Market-implied probability

  • 24 hours up 3 pts
  • 7 days down 1 pts

Source

Single source

Key facts

Ends
December 31, 2026 81 days left
Volume
6.9M

Probability History

Outcomes Market-implied probability

  1. 4.25% 68% 24 hours: up 3 pts
  2. 4.0% 18% 24 hours: down 4 pts
  3. ≥ 4.5% 10% 24 hours: down 1 pts
  4. 3.5% 2% 24 hours: no change
  5. 3.75% <1% 24 hours: no change
See all 15
  1. 3.25% <1% 24 hours: no change
  2. ≤1.0% <1% 24 hours: no change
  3. 1.25 <1% 24 hours: no change
  4. 1.75% <1% 24 hours: no change
  5. 2.25% <1% 24 hours: no change
  6. 2.5% <1% 24 hours: no change
  7. 2.75% <1% 24 hours: no change
  8. 3.0% <1% 24 hours: no change
  9. 2.0% <1% 24 hours: no change
  10. 1.5% <1% 24 hours: no change

Each option is priced on its own, so these may not add up to 100%.

How It Resolves

The FED rate is defined in this market by 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 according to the upper bound of the Federal Reserve’s target federal funds range after the December 2026 Federal Open Market Committee (FOMC) meeting, currently scheduled for December 8-9, 2026.

This market may resolve immediately after the statement for the FOMC’s December meeting, with relevant information about the FOMC’s decision on the target federal funds range, has been issued. If no FOMC decision on the target federal funds range for their December meeting has been issued by December 31, 2026, 11:59 PM ET, this market will resolve according to the upper bound of the target federal funds range at that time.

The upper bound of the target federal funds range will be rounded to the nearest 25 basis points for resolution of this market. If the upper bound of the target federal funds range falls exactly between two listed options, it will be rounded away from zero (e.g. if the upper bound is 2.875, with listed options of 3.0 & 2.75, this market will resolve to 3.0).

The primary resolution source for this market will be official information from the Federal Reserve (https://www.federalreserve.gov/monetarypolicy/openmarket.htm).

Resolution source: Polymarket

Expected resolution: December 31, 2026